Gambling News - June 2005 Edition

"Online Gambling Site in a 8.5bn Pound Sterling Play"

PartyGaming could be first Internet gaming group to enter the FTSE 1

Gibraltar based online gambling portal, PartyGaming could be the first Internet gaming group to enter the FTSE 100 index. The company has announced plans to float on the London Stock Exchange in late June. The expected valuation will be for 5.8 billion pounds sterling, and if the floatation is successful, it will be the largest float of its kind in London since 2002 when William Hill, the bookmaker, went on the public market.

The company’s flotation would make its founders, Amurag Dikshit, Vikrant Bhargava, Ruth Parasol, and Russ DeLeon, all billionaires. Dikshat and Bhargava are graduates of the Indian Institute of Technology, one of India’s top universities. They own 42 percent and 14 percent of company shares respectively. Ruth Parasol, who used to work in the adult entertainment industry, owns twenty percent and so does her husband, Russ DeLeon. If the float succeeds, Dikshit’s percentage will bring him a cool two billion pounds sterling.

PartyGaming, which established its headquarters in Gibraltar for tax purposes, has seen increases in its profits every year since it started. In the first quarter of 2005 alone, the company turned over 222 million dollars. Its flotation of five to eight billion pounds sterling on the FTSE would give the company a higher value than British Airways or Boots. PartyGaming claims over fifty percent of the global online poker market and its PartyPoker website hosts up to 65,000 players at peak periods. According to Nielsen/Net rating, online gambling has increased in the United Kingdom by 45 percent compared with last year, with over 3 million visitors logging in to online gambling sites in February.

PartyGaming hopes to create an air of legitimacy and credibility for itself by floating on the FTSE. Other online gaming companies are taking much the same approach. 888Casino.com, another online gaming company that is based in Gibraltar, also announced its plans for a flotation on the FTSE. 888Casino.com intends to float later this year and has enlisted the aid of Credit Suisse First Boston to complete a strategic review.

PartyGaming will use the firm of Dresdner Kleenwat Wasserstein as its sponsor, book runner and global coordinator. Dresdner Kleenwat Wasserstein in turn plans to use other banks as well to assist in the job.

Figures released earlier this year by Irish bookmaker, Paddy Power, show that Ireland is also seeing the effects of the online gaming boom. Paddy Power showed record increases in operating profit, turnover, and earnings per share for 2005. The online betting firm, Victor Chandler, also recently established its tax free betting services in Ireland as well as building its first casino in the country.

Back to June 2005 News Home