PADDY POWER FINALISES P.M.U. DEAL
13 November 2009
Shares rise 5.6 percent
Irish online and offline bookmaker Paddy Power has
confirmed its deal with the French gambling monopoly
Pari Mutuel Urbain (PMU) which will smooth its path into
the liberalised French gambling market early 2010.
The bookie firm also said it remains on track to
meet market expectations for full-year profits, boosting
its shares by 5.6 percent midweek.
The agreement
with PMU will see Paddy Power committed to a five-year
outsourcing deal to provide betting technology and
pricing to the French horse racing operator, the largest
betting organisation in Europe with Euros 9.3 billion of
turnover in 2008, according to the Reuters news agency.
Analysts were enthusiastic about the deal, opining
that it could open other doors for Paddy Power in a B2B
sense with other French and European companies as Europe
is expected to open up and regulate rather than confine
gambling to state monopolies. One alalysts characterised
the deal as a massive catalyst for Paddy Power stock.
Reuters reports that Paddy Power's financial
director Jack Massey expects the deal with PMU will come
into effect around May or June 2010, adding some Euros 3
to 5 million in revenue by 2012 and open up other
opportunities.
"The strength of the deal is the
quality of the partner which gives us an excellent
calling card of other such opportunities that may
emerge," Massey said in an interview with the news
agency.
Paddy Power's md for non-retail and
development, Breon Corcoran, added that Paddy Power
expected to expand further through outsourcing deals and
partnerships with local partners as a number of
regulatory markets open up over the next three to five
years.
The deal will create 50 jobs at Paddy
Power's Dublin headquarters by June 2010, with 200
additional jobs expected in the following three years.
The company reported on its progress, noting that
while sporting results were adverse for the 19 weeks to
November 10, 2009, turnover for the period had grown
strongly as its presence in the UK increased to 80 shops
after it added 22 outlets earlier this year.
Paddy Power is on the Orbis sports platform, but it is
understood that PMU has decided to outsource the risk
management and pricing functions to a third party.
Paddy Power chief executive Patrick Kennedy said
that the agreement with PMU was an impressive start for
the company's new B2B division, and that the firm would
be capitalising on its expertise and technology to close
agreements with other major betting companies.
The chief executive of PMU, Philippe Germond commented:
"This partnership is going to enable PMU to offer
sporting bets online under its own brand and retain
direct management of its client database. Paddy Power
will provide us with its expertise in sports betting.
Through this partnership PMU is given the means to be
ready for the opening of the online betting market in
France next year."
Online Casino News Courtesy of
Infopowa
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