Although it was previously highly speculated, it is now official. Shuffle Master has entered into a definitive agreement to acquire the Ongame Network Ltd., from bwin.party. Ongame is one of the world’s largest poker providers to online gaming operators with a global network that includes more than 25 brands and operators, as well as regional networks in France and Italy.
“Our acquisition of Ongame will allow Shuffle Master to offer a scalable, proven and secure solution for online poker. Immediately upon closing the transaction, we will be able to begin leveraging all of Ongame’s experience and expertise in iGaming,” said Gavin Isaacs, Chief Executive Officer of Shuffle Master. “I am confident that Ongame will fit seamlessly into our ongoing interactive initiatives of delivering our renowned brands to online gaming operators, partner web sites, social networks and mobile platforms. Poker is a natural fit for our table-centric online offerings and our many jurisdictional licenses present a compelling opportunity for our current and future online customers. This acquisition is further evidence of our great momentum as we continue to execute on our core businesses and pursue our strategic objectives for future growth. We look forward to Ongame joining the Shuffle Master family and we welcome them on board.”
As consideration for the purchase of the shares of Ongame, Shuffle Master will pay bwin.party Services 19.5 million euros in cash, subject to certain adjustments at closing, and may pay up to 10 million euros in cash within five years of closing, contingent upon the commencement of legalized, real-money online poker in the U.S. within such period. Shuffle Master expects to fund the transaction with cash on hand or availability on its existing senior secured revolving credit facility.
Shares in Shuffle Master have gone up by about 15% by midday trading on the Nasdaq and bringing the company’s overall market capitalization to $900 million.
Shuffle Master is one of the list of US based technology companies scrambling to make acquisitions or strategic partnerships with egaming providers with the hopes of positioning themselves when eventual poker regulation becomes a reality in the United States.
Now what can this acquisition mean for Canadian poker players? Well for starters, it is very likely that by the time the Ongame Purchase is finalized, BWIN who represents the largest single operator on the Ongame network will transition over to the Party Poker Network, and therefore, player liquidity on Ongame will decrease by an estimated 40% whilst benefitting the Party Network. Furthermore, if the past actions of other land based gaming technology competitors of Shuffle Master who have made similar deals are anything to rely on, it is likely that like IGT and GTECH networks who have ceased catering to the Canadian poker market, the Ongame Network may eventually become off limits to Canadians, but that’s just speculation and nothing is for sure yet.