Leading igaming software supplier Playtech has announced the bolt-on acquisition of Gibraltar-based poker affiliate business PokerStrategy.com from parent company Etruvian Holdings for €38.3m in cash.
Centred around a poker school and community forum, PokerStrategy.com is one of the largest poker affiliate businesses in the world, driving its non-US player base to a range of online poker rooms and taking a cut of the money they subsequently spend on these sites. It generated a pre-tax profit of €19.5m last year, with net assets of €16.3m as at 31 December 2012.
Playtech said it saw the acquisition as complementary to its its PTTS turnkey division - creating incremental opportunities to sell both software and marketing services to licensees - and its iPoker business, giving its licensees access to PokerStrategy’s six million-strong membership.
iPoker licensees already make up half of the 18 operators currently working with PokerStrategy.com, led by brands such as Bet365, William Hill, Titan, Betfair and Paddy Power, with the remainder made up of standalone rooms such as PokerStars and PKR and licensees of other networks such as Microgaming and Ongame.
Playtech however flagged up today that two of PokerStrategy’s “larger customers terminated their contracts” during 2012 and 2013 – understood to be 888 and PartyPoker owner bwin.party - but were under contract to continue paying fees in respect of some higher raking players up to 2015.
888 terminated its deal with the poker affiliate in July 2012, with bwin.party following suit in December 2012, which it said was part of a wider move to rebalance the PartyPoker player pool in favour of more casual players.
PokerStrategy’s parent company Etruvian has recently diversified into other business areas, extending the PokerStrategy tuition model into financial trading with Tradimo, and also entering the casino affiliate space with CasinoCheck. Founders Dominik Kofert and Enrique Guzmán will stay on with PokerStrategy on a consultancy basis.
Playtech, which has by far the most consistently impressive record in the online gambling sector when it comes to acquisitions, said today it believed the buy “is earnings enhancing”.
The software supplier’s successful acquisitions of poker network Tribeca Tables Europe in November 2006 and bingo platform Virtue Fusion Alderney in February 2010 helped establish it as B2B leader in three product verticals. Other notable buys included casino suppliers GTS and Ash Gaming in 2009 and 2011 and PTTS from its founder Teddy Sagi in 2011.
PokerStrategy.com has no links with Poker-Strategy.org, the poker affiliate website which offered the first publicly available rakeback deal back in April 2004.
Article written by Peter Holmes
