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Online Gambling Merger May Create Industry Giant
LONDON, ENGLAND --
The disclosure this week that online gambling operators bwin and PartyGaming are considering consolidating into one firm sent ripples through the industry. Each company is already valued at over $1.5 billion, leading to the potential of an online gaming colossus worth upwards of $3 billion.
Regulators from the UK are expected to ask PartyGaming CEO Jim Ryan to confirm or deny speculation that the two companies are in a stage of formal talks concerning merging. PartyGaming has been aggressively enhancing its options since paying a $105 million settlement to the US Department of Justice to close an investigation.
The online gaming operator has purchased much of the assets and brands of the World Poker Tour and also acquired online bingo company Cashcade for $150 million, since ending the long-running dispute with the US.
Market analysts have predicted that online gambling operators would enter a period of consolidation, as financial circumstances look favorable in the near future, and the opening of the US market is anticipated.
Whispers reported by industry sources say any merger is still in beginning stages, although the companies are expected to approach the joining as a combination of two equals. No word has been released on potential corporate structure.
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