PartyGaming Negotiating Acquisition of Empire Online

On Thursday, December 28th, PartyGaming, operator of PartyPoker.com, the world's largest online poker room, stated that it is negotiating the acquisition of Empire Online's gaming assets.

According to Analysts, the deal could have a price tag of about $40 million and is likely to include Empire Online's "Noble Poker" and "Club Dice" websites.

The takeover move comes in the middle of a company crisis as PartyGaming was forced to back out of the US market in light of the passing of the Unlawful Internet Gambling Enforcement Act (UIGEA) that was introduced in October. The ban makes it hard for online gaming companies to operate in the US.

Shares in PartyGaming went up 2.5% by midday trading in the London Stock Exchange.

PartyGaming is interested in taking hold of Empire's savvy marketing strategy. Empire Online is known for making skins, a number of websites that serve as portals for online gamblers to enter gambling sites. Empire then gets a percentage of the revenue made from gamblers who play online after accessing the site through their various skins.

According to Empire Online, the company plans to become an investment company after it has relieved itself of Internet gambling assets. Empire added that the proceeds from the acquisition, in addition to $250 million of accumulated cash, will be used to invest in other companies.

January 31, 2007
Jeremy Evans