BIG DEALS WILL FOLLOW ANY U.S. LEGAL RESOLUTION

31 August 2007

Online gaming firms will consolidate once US barrier removed, says Party Gaming CEO


Speaking on a conference call with media journalists following the publication of his company's first half results, Party Gaming.com CEO Mitch Garber said that the online gaming industry is ripe for consolidation once the barrier of retrospective legal action from US authorities has been removed. PartyGaming plc is well-placed to be at the centre of such activity, he added.

Garber reminded reporters that PartyGaming, along with rival 888 Holdings plc, initiated talks with the Department of Justice in June (see previous InfoPowa report) seeking clarity regarding actions taken by law enforcement agencies against other internet gambling companies which had US-facing operations before the enactment of the Unlawful Internet Gambling Enforcement Act last year.

"The fact that companies like ours and 888 have voluntarily approached the Department of Justice is a giant step towards putting legacy issues behind any of the companies," Garber explained, revealing that the talks are still in progress and have a good chance of achieving a positive outcome.

"We continue to move towards what we hope will be considered by all a satisfactory resolution. Once that's done, I think there's going to be quite a lot of consolidation activity,' he said. And as the world's biggest online poker operator, Garber expects Party Gaming to be involved in such deals.

"Being a $2-3 billion market cap company, we can certainly be a consolidator of fair sized companies and we can be a target of several of the mainstream, large international gaming companies. It wouldn't be unreasonable to assume that, at some point in time, both of those opportunities will present themselves and we'll deal with them as they come," he said.

Earlier this year, Ladbrokes PLC was forced to scrap plans to acquire 888 amid concerns it would not have been able to successfully ring-fence any liabilities or legal ramifications faced by 888's previously US-facing operations.

Online Casino News courtesy of InfoPowa