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Party Gaming and Bwin to Merge

December 16, 2009

Party Gaming is one of the largest online casinos in the world.  They are most popular in the United Kingdom, and were for a time highly sought in the United States.  Unfortunately when the United States created the UIGEA Act that banned online casinos and gambling Party Gaming had to leave.  They didn’t leave soon enough for the US, so the United States charged Party Gaming with a very high fine.

The fine is for $105 million.  This fine has held Party Gaming back for several months.  They have been unable to grow or change much because they were in discussions with the US.  Luckily though, they have been able to get a new deal that will allow them to pay the debt over time.  In fact they have four years to pay the $105 million back.  This has allowed them to enter into new partnerships with other online casino operators like Bwin.

Party Gaming and Bwin have made a deal that creates a $2 million merger.  Many believe this will change the online gambling world as we know it.  The merger has yet to be signed by both parties as some negotiations are still occurring.

One thing that will be affected by the merger is the Party Gaming shares.  Their stock shares suffered when they were being fined for United States online gambling, when they were supposed to pull out.  Even though the agreement was for non-prosecution this didn’t seem to mean much to those selling the company’s shares.  With the new merger one expects that the shares in both Party Gaming and Bwin will increase.  In fact the merger will create a new “bigger” company.  Everyone seems to be keeping an eye on the two companies and cannot wait to hear what final decision will be made.  Certainly the companies will do something, but one may wonder what the merger will actually affect.

Party Gaming has worked hard to bounce back after the 2006 issues with the US, even so far as to hope the laws will change so they may once again enter the market.  Already Party Gaming has tried to expand in the Europe market.  They increased their value by 1.2 million Euro already.  For other online casinos this means Party Gaming will be a huge force to beat out in competition, which may make it difficult for most of the online casinos just starting up.