PartyPoker owner bwin.party has confirmed the sale of its Ongame B2B poker network to Canadian gaming supplier Amaya Gaming for up to €25m.
Amaya, which also operates the InterCasino B2C brand through its CryptoLogic online casino games subsidiary, will pay €15m in cash during the fourth quarter, with additional payments of up to €10m in the event there is regulated online gaming within the US within the next five years. The latter payment is based on how many individual states and the proportion of the US population that comes into play.
The sale follows Amaya returning to the negotiating table with bwin.party after Nevada-licensed casino supplier Shuffle Master pulled out of a deal in late June to buy the poker network for up to €29.5m, citing deteriorating conditions in the European online poker environment.
bwin.party co-CEOs Jim Ryan and Norbert Teufelberger (pictured) welcomed the sale ahead of the company’s move to a “single, proprietary technology platform” in the coming months. The group is set to merge liquidity from its poker brands – moving bwin’s players off the Ongame software – on the PartyGaming platform in dot.com markets and in the ring-fenced French market by the end of 2012.
David Baazov, CEO of Amaya, said the acquisition would transform the company “into a leading provider of gaming platforms”, and that the Ongame platform had proved itself “scalable, proven and secure and well suited for quick deployment in new regulated markets”.
Amaya, which established itself as a supplier of gaming systems to government lotteries, began its evolution into a fully fledged egaming supplier in May last year with the purchase of online casino supplier Chartwell. The acquisition of CryptoLogic followed in February of this year.
Stockholm-headquartered Ongame runs an open dot.com poker network and regional networks in France, Italy and Spain, with 19 operators running 25 brands on the software platform, including Betfair, Betsson, Betsafe, and Paf.
It is currently the fifth largest site/network measured in terms of cash player traffic (Source: PokerScout) but this is expected to fall by well over half when all of bwin’s poker players are moved on to the Party Poker platform.
In Italy, Ongame’s market share of poker ring games would fall to less than 2.9% from 10.8% once bwin migrates its bwin.it and GiocoDigitale.it brands off the platform, according to calculations by Casino Choice based on June data from Italian regulator AAMS. In tournaments, this would drop to 3.35% from 15.2%.
In a further blow to the B2B poker network, major Ongame licensee Betfair also confirmed last month that it was to join rival Playtech’s iPoker network in the ring-fenced markets of Spain and Italy. Ongame has struggled to gain traction in Spain, where it only appears to be powering Paf.es, after bwin.party launched bwin’s dot.es poker room on the PartyPoker platform from the opening of the regulated market in June.
Article written by Stephen Carter