Bwin.party moves to quash break-up reports
Operator pours cold water on speculation it is planning a break-up or sale of the business
Bwin.party said this morning it has “no plans” to break up or sell the company, following reports the firm is undertaking a strategic review of the business ahead of a potential sale or split.
Bloomberg reported last night the online gambling giant had hired financial services firm Deutsche Bank to explore its options including a potential sale of some or all of the business with a decision expected within two months.
However, bwin.party this morning moved quickly to quell the speculation and issued a statement to the stock exchange confirming there were no plans for a sale.
“Since his appointment as Chairman last month, Philip Yea has been working with the executive management team on ways in which the Group can increase shareholder value, however we can confirm that there are no plans to break-up or sell the company,” the statement read.
The group’s performance as of late has been underwhelming despite initial signs of recovery in the firm’s Q1 results disclosure in April.
Revenues had risen sequentially but were still down around 6% year-on-year, attributed to ISP blocking in Greece and a general decline in the poker market.
The company’s underperformance has triggered activist investor Jason Ader to demand change at the top, and last month the bwin.party board struck a compromise agreement with Ader with one of his nominations, Daniel Silvers taking a place on the board
Speaking to eGR earlier this year Ader himself revealed that splitting the company into regulated and unregulated businesses was a possible future strategy.
While bwin.party CEO Norbet Teufelberger has previously said the firm may look to divest of “non-core” assets during 2014.
“We have a range of non-core businesses, and as a management team we have set ourselves the goal to either divest out of those businesses or partner up and grow them again,” Teufelberger said following bwin.party’s 2013 annual results announcement.
The reports follow a crash in the bwin.party share price, which had fallen more than 20% in the two weeks since Amaya Gaming Group announced that a deal was in place for it to acquire the Rational Group and its PokerStars and Full Tilt Poker brands.
Yesterday eGaming Review revealed that following the sale PokerStars could be live in New Jersey as early this autumn, which would have significant repercussions for bwin.party’s US-facing business, one of the early market leaders in the state.
Bwin.party’s share price rebounded this morning on the back of the reports and is up 7% in early trading.