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Found 3 results

  1. According to Bloomberg, the price tag for Amaya Gaming's rumored purchase of PokerStars' parent companycould be more than $1 billion. The news outlet, which released a series of articles on Thursday about the potential acquisition, said, "Blackstone Group LP's credit business, GSO Capital Partners LP, is among the backers of Amaya's bid, arranging more than $1 billion in financing." Trading of Amaya's stock in Toronto was haltedmidday Thursday after it had risen 28% in two days and 17% on Thursday alone. The reason, according to multiple reports, is a forthcoming acquisition of PokerStars' parent company, Rational Group. E-mails from PocketFives requesting comment sent to Amaya and Rational were not returned at press time; Bloomberg could not procure comments from either company. Up in the air is what exactly Amaya would be acquiring. Bloomberg reported that the deal is for PokerStars' parent company, which would theoretically also include Full Tilt Poker, which Rational Group acquired in the middle of 2012 upon its settlement with the US Department of Justice. Other possibilities we've heard include the Full Tilt Poker brand and software as well as the potential for a reverse takeover, as reported by CalvinAyre.com, which originally broke the story. As far as the funding goes, Bloomberg reported, "Blackstone, based in New York, is preparing to announce its largest-ever credit deal, with more than $1 billion of fund commitments… The agreement, which the firm expects will be announced as soon as today, is an acquisition financing for a North American company." The company in question was not revealed, although the general consensus is that the funding is earmarked for Canadian-based Amaya. As of press time, no deal for Amaya to acquire PokerStars had been announced, nor had any formal announcement of the $1 billion in funding from Blackstone. The latter extended up to $160 million in credit to a subsidiary of Amaya late last year. PokerStars has run into trouble acquiring a license in New Jersey and circumventing a "bad actor" clause in California. As one poster on Two Plus Two put it, "Rational realizes that it has little chance of breaking into the US market within the next decade, thus making PokerStars less valuable to Rational than to someone who has a better chance of breaking Stars into the US market. If the price is anywhere within that gap in value, it's win/win (Rational sells for more than it's worth to them; buyer buys for less than it's worth to them)." We'll keep you posted on this still-developing story. Want the latest poker headlines and interviews? Follow PocketFives on Twitterand Like PocketFives on Facebook. You can also subscribe to our RSS feed.
  2. There's more news about the rumor that Amaya Gaming is in talks to acquire PokerStars. According to Bloomberg, trading of Amaya's stock on the Toronto Stock Exchange was halted on Tuesday "following a 28% surge in the past two days." What the stoppage means regarding a potential acquisition, if anything, is not yet known, but a separate Bloomberg article stated that an announcement of a deal could come on Thursday. Bloomberg told readers, "The stock was halted for pending news, according to a statement from the Investment Industry Regulatory Organization of Canada." Spokesmen for Amaya and PokerStars declined to comment on the story. Trading was officially halted on Thursday after Amaya's stock rose another 17% to settle at CAD $14.08, up from just short of $6 in April. It's unclear whether the acquisition would involve the PokerStars brand, PokerStars software, PokerStars customer base, or the entire Rational Group, the latter of which includes PokerStars' sister site, Full Tilt. A reverse takeover is also not out of the question. An acquisition could also just involve the Full Tilt brand and/or software, allowing PokerStars to focus on its own brand. According to PokerScout, Full Tilt Poker, once the second largest site in the world in terms of cash game traffic, has slid to #5. It recently launched casino games and has seemingly struggled after being declared a "global Ponzi scheme" by the US Government. Bloomberg analyzed, "Acquiring PokerStars would mark a significant leap for Amaya in the $4 billion global business of online poker. The company, based near Montreal, generated $155 million in revenue last year. Gaining new ownership would remove an obstacle for PokerStars, the largest site of its kind, to return to the US after past clashes with authorities prevented the site from taking part in legal online gambling emerging in some states." In late May, Amaya responded to the acquisition rumors by coyly stating, "Strategic acquisitions have been and are one component of the company's growth strategy and, as such, Amaya regularly evaluates potential acquisition opportunities… From time to time, this process leads to discussions with potential acquisition targets, [but] there can be no assurance that any such discussions will ultimately lead to a transaction." A graph of Thursday's trading is given at left. PokerStars finalized its purchase of longtime rival Full Tilt Poker in mid-2012for nearly three-quarters of a billion dollars. Its founder, Isai Scheinberg, and its Director of Payments, Paul Tate, were among 11 individuals indicted on Black Friday on charges that included money laundering and wire fraud. Neither Tate nor Scheinberg has surrendered to US authorities. PokerStars has run into numerous setbacks while trying to reenter the US market. In New Jersey, the review of its gaming license was suspended for two years, while in California, a "bad actor" clause threatens to shut it out of the largest US state population-wise. Want the latest poker headlines and interviews? Follow PocketFives on Twitterand Like PocketFives on Facebook. You can also subscribe to our RSS feed.
  3. Recently, an article published by CalvinAyre set the poker industry abuzz with rumors that the Canadian firm Amaya Gaming would purchase the online poker behemoth PokerStars. But this week, perhaps hoping to quell the gossip, Amaya decided to release a statement that was seen as a tacit denial of the surprising report. The first inkling of a deal came on May 16, when Industrial Alliance Securities analyst Neil Lindsell stated that Amaya would likely sell its Ongame poker network in order to "trade up" to a bigger platform, according to the CalvinAyre piece. Since then, the company's stock has shot up from CAD $7.71 at the end of that trading day to CAD $10.89 as of Thursday, or 40%. Later came the CalvinAyre article, which stated that "solid" sources had assured them that a deal between PokerStars and the gaming software provider was in the works. Responding to the high trading volume, Amaya stated that "strategic acquisitions have been and are one component of the company's growth strategy and, as such, Amaya regularly evaluates potential acquisition opportunities." It went on to explain that "from time to time, this process leads to discussions with potential acquisition targets," but that "there can be no assurance that any such discussions will ultimately lead to a transaction." It seems plausible that, at the very least, some level of talks took place that might have helped to spark the rumors. When comparing the spike in Amaya's share price to Lindsell's "trading up" statement, along with the fact that the company hasn't released any significant news in the past few weeks to prompt such a surge, the acquisition theory is compelling. But, there are several reasons why a deal between the two companies wouldn't make sense. For one, it would seem that Amaya, whose market cap hovers around $500 million, according to CalvinAyre, would have trouble coming up with enough cash to purchase a company as big as PokerStars. After all, the poker giant paid its way through Black Friday, even shelling out over $700 million to purchase Full Tilt Poker and pay back its American players in the process. Second, a PokerStars/Amaya deal could have negative regulatory implications for the company's dealings in the regulated US internet gambling market. "Amaya Gaming services virtually every casino platform in New Jersey," said industry expert John Mehaffey. "It also owns the Ongame platform used by Betfair. Introducing PokerStars ownership into the equation before the company is approved could create a licensing conflict." Yet even if there is, in fact, no deal between PokerStars and Amaya, some think that PokerStars could still be looking to sell in order to distance itself from founder Isai Scheinberg and his son and current CEO, Mark Scheinberg. It's no secret that the poker giant has pulled out all of the stops in its quest to reenter the US online gambling market; a deal that severs executive ties with the Scheinbergs could be a final attempt at allaying regulator's concerns. In New Jersey, PokerStars' licensing review was suspended for two years due to the alleged ongoing participation of the elder Scheinberg in the company and the site has already been locked out of Nevada due to a "bad actor" clause. For the moment, that leaves California, where the company is doing battle with gaming interests who hope to insert a similar clause into any legislation that legalizes internet gambling. PokerStars announced a major partnership in California with the Morongo Band of Mission Indians, Bicycle Casino, Commerce Casino, and Hawaiian Gardens. "As a general policy, Amaya does not publicly comment on potential acquisitions unless and until a binding legal agreement has been signed," Amaya concluded. "The company intends to make no further comment or release regarding current market rumors unless and until such comment is warranted." Want the latest poker headlines and interviews? Follow PocketFives on Twitterand Like PocketFives on Facebook. You can also subscribe to our RSS feed.
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