Online casino law propels mergers
The repercussions of the recent law which was passed in the United States under the Port Security Act, the Unlawful Internet Gambling Enforcement Act (UIGEA), have been felt and noticed around the online casino industry. As soon as the online casino law was passed in Congress, and was about to be signed by the President into the law books, experts expected to see a growing number of mergers between online gambling businesses.
Among such mergers, those that have already taken place and future ones that will come, one clearly stands out. A final deal has not yet been signed, but an announcement last week confirming talks of a possible takeover involving big players in the online casino sector – online casino group 888 and bookmaker Ladbrokes. The new reality which the online casino law has created brought Ladbrokes to make an offer to take over 888, in a deal worth about 700 million dollars.
The high profile and value deal and the rise in the online casino companies’ stock values that followed the announcement is a part of the sector’s realignment following the law, and preparations before it takes effect. Online casino group 888 was reportedly said to be sought after by rival Partygaming. That deal was valued at around 3 billion dollars. But consolidation with a conventional gambling company was a better business move in the eyes of the majority shareholders of 888 and so the new deal has reached its current stage.