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Copyright 2004 Times Newspapers Limited
Sunday Times (London)
October 24, 2004, Sunday
HEADLINE: Sportingbet is set to raise poker
stakes
BYLINE: Matthew Goodman
BODY:
THE world's largest internet betting group,
Sportingbet, is in talks to acquire Paradisepoker, an online
poker firm, for more than £170m.
The acquisition would almost double the size
of Sportingbet, whose shares are traded on the Alternative Investment
Market. It has a market value of Pounds 229m.
The news comes as it emerged that Richard
Segal, the former boss of Odeon Cinemas, has joined the owner
of the world's biggest online
poker business Partypoker.com
as chief executive. His appointment to the
board of iGlobalmedia will fuel speculation that the firm could
be grooming itself for a flotation.
Sportingbet announced last week that it was
in "advanced discussions" about a "potential substantial
acquisition of an online poker business".
It did not name the company it is buying,
but The Sunday Times has learnt that the target is Tropical Paradise,
which operates the Paradisepoker website from Costa Rica. The
site has been on a publicity drive in Britain this year and launched
a series of advertisements featuring the model Caprice.
Industry sources said that the founders of
Tropical Paradise had been trying to sell the business for several
months.
Last week, Sportingbet, founded in 1998 by
bookmaker Mark Blandford, said its acquisition would be "significantly
earnings enhancing" although it warned it was not certain
a deal would be agreed.
Sportingbet was recently named the world's
leading online gambling operator by the industry bible eGaming
Review, which put it ahead of Ladbrokes and William Hill.
The purchase of Partypoker would give it an
even greater lead.
Last week, a report on the interactive gaming
industry by the stockbroker Arbuthnot Securities gave a "buy"
recommendation for Sportingbet and said the company had "an
opportunity to accelerate progress".
However, some investors have remained wary
of the company because it does a large part of its business in
America, where online sports betting is banned.
Partypoker has been discussing a flotation
with a small number of investment banks, as revealed by The Sunday
Times last month, and Segal's appointment will be seen as a another
step towards this goal.
Segal, 41, left Odeon in August last year
after seven years at the cinema chain.
He said last night how excited he was to be
joining: "The growth rates both in terms of this market and
this business are something that are fairly unequalled."
Segal had been considering a number of opportunities
with private-equity groups before deciding to join iGlobalmedia
during the summer.
Meanwhile, Betfair, the online betting exchange,
will this week announce plans to launch a legal challenge to the
Dutch government over its decision to award an exclusive betting
licence to De Lotto, the monopoly betting and gaming firm in Holland.
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