Sportingbet has confirmed it has put in a US$1.4bn bid for listed egaming firm Empire Online, following widespread press speculation in the UK.
Empire Online, the owner of poker site Empire Poker, said on Friday it had begun talks with an unnamed firm over merger talks.
Initial speculation suggested the firm in question was PartyGaming, but media reports in the UK claimed it was Sportingbet.
And the widespread speculation led this morning to a statement from Sportingbet.
"Sportingbet announces that it is in discussions with Empire, which may or may not lead to an offer for the entire issued and to be issued share capital of Empire," the Sportingbet statement said.
"These discussions are at a very preliminary stage, and there can be no certainty whatsoever that agreement will be reached and an offer will be forthcoming," it added.
The deal would be the largest in egaming history, and would far exceed Sportingbet's US$300m acquisition of Paradise Poker last November.
And it has surprised many within the egaming industry, with Sportingbet only recently completing the integration of its US sportsbook brands with the Paradise Poker network.
But the potential acquisition of Empire Poker throws up far more integration issues.
PartyGaming currently provides the software and payment processing for Empire Poker through a white label deal.
Empire Online also derives a proportion of its revenues from affiliate marketing deals for the casino operations of 888 Holdings and PartyGaming.
However, sources said PartyGaming was unlikely to allow its largest white label to fall into the hands of one of its major competitors.
And press reports in the UK have also linked PartyGaming with considering putting in a rival offer, and it would have the firepower to outbid Sportingbet.
PartyGaming, which runs the PartyPoker website, is the world's largest listed egaming firm with a market capitalisation of almost US$12bn.
In comparison Sportingbet has a listed market capitalisation of around US$2.2bn, and US$2.8bn on a fully diluted basis.
Sportingbet declined to comment further on the news.
source : egr magazine
