GVC to implement €120m savings on bwin party, marketing to be refocused

GVC will implement cost synergies of €120m in the next 24 months as part of its restructuring of bwin party but chief executive Kenny Alexander has stated that the group’s focus will be to grow the business significantly and ensure return on investment.

Alexander’s comments follow news of GVC’s offer for bwin party being accepted by the company’s board this morning as it withdrew its previous recommendation for 888’s offer. The deal values bwin party at around €1.4bn (£1bn) and will be financed by a combination of cash and shares.

GVC will deliver the €120m synergies on the enlarged group by 2017, Alexander said, with around 60% of the cuts implemented throughout 2016; these will focus on marketing, staff and sourcing and IT.

Some of the synergies will be in poker and casino but most of them will occur on the sportsbook vertical. “There is lots of duplication (on the sportsbook side of the companies) and there will be greater synergies than 888 (could achieve) because we run our own sportsbook,” Alexander said.

“We’ve done it before with Sportingbet, we don’t believe there is significant cross-over (of customers having accounts with both operators) and believe our customers will have a better experience (on bwin) because it’s a better platform.”

GVC will move its betting business on to the bwin platform, “it’s better, more scaleable, has had significant investment over a long number of years and we think it’s one of the market leading platforms. We intend to develop and improve the product in coming years,” Alexander added.

In terms of marketing, many of bwin’s sponsorship agreements with some of the leading football clubs in Europe will be terminated.

“bwin’s sponsorship deals have built up the brand and its brand recognition in Europe is second to none but we think we can scale it back now and focus on growing the business.”

The GVC boss was quick to point out that the group had “no intention of exiting bwin from markets they are currently working in. The bwin focus is on regulated markets and we will focus investment in the (regulated) markets where we think we can get meaningful return on investment: where we think we can get good profits and ROI. It’s not difficult to see which regulated markets we’re talking about”.

GVC will maintain investments but will switch marketing activities from territories and channels where it believes returns are not significant. It will also intensify CRM efforts to optimise efficiencies.

Alexander added that he was looking forward to motivating and reinvigorating the bwin party staff, and that Norbert Teufelberger was staying on as a non-executive director would be a great boost to the group.

With regard to the group’s non-core assets, GVC will continue to run bwin party’s bingo business on the Dragonfish platform, and look to grow its online poker and casino sites and assets such as the World Poker Tour. “Obviously if there is an opportunity to dispose of assets in the interest of shareholder then we will look at them,” finance director Richard Cooper commented.

Bwin.Party sells poker tournaments business for $35m

Bid target Bwin.Party has sold its televised poker tournaments business to a Chinese gaming company for $35m (£22.1m).

The online gambling firm is offloading World Poker Tour (WPT) to Ourgame International, a Hong Kong-listed developer of internet and mobile games.

Loss-making WPT broadcasts high-stakes poker tournaments in more than 150 countries, and Bwin.Party will remain a sponsor of its shows and events until December next year, with first refusal over other deals beyond that date.

Dave "The Devilfish" Ulliott, Britain’s best-known professional poker player who died earlier this year, is one of WPT's past champions.

The sale comes as Bwin.Party itself considers two competing takeover approaches, one of which is understood to value the company at €1.5bn (£1.1bn). Martin Weigold, finance chief of the FTSE 250 group, said the WPT disposal was “consistent” with its plan to sell non-core businesses.

“We believe that now is the right time to release that value for shareholders so that we can focus our efforts on our core real money gaming and technology business,” he added. Shares in Bwin.Party were up 2.9pc in afternoon trading on the sale.

WPT, which holds tournaments in cities such as London and Las Vegas, posted an adjusted loss of €4.1m last year on revenues of €10.4m. PartyGaming, which merged with Bwin in 2011, bought the business for $12.3m almost six years ago. Beijing-based Ourgame, the new owner, agreed a licensing deal with WPT covering a number of Asia countries in December.

Bwin.Party made no mention of its potential takeover in Monday’s announcement.

Amaya, the Canadian giant behind Pokerstars and Full Tilt Poker, has teamed up with GVC for a €1.5bn approach for the company, while online gambling group 888 Holdings has also made a rival takeover proposal.

Shares sales earlier this month by the two founders of PartyGaming rattled investors by sparking concerns that a deal for Bwin.Party might not materialise.

Bwin.party announce plans to close their WPTPoker skin

Bwin.party has announced plans to close their WPTPoker skin on June 3 citing plans to focus their online poker efforts on the partypoker and bwin brands.

Players spending their time on WPTPoker.com will have to find a new home. Their cyber doors will shut on June 3, and they will not reopen. The online poker room opened on the partypoker network in 2009, after party acquired the World Poker Tour (WPT) from WPTE. Whilst it never set the world alight, it would have been home to a lot of people.

A letter sent to players explaining the reason for closure cited bwin.party’s desire to concentrate all of their efforts on their two leading brands: partypoker and bwin poker. The content of the letter can be read below in full:

Dear Players,

Bwin.party has made the decision to focus our online poker efforts entirely on our lead brands: partypoker and bwin poker. This has resulted in the decision to close our WPTPoker.com site.

Please be aware that we are unable to move any balance directly from a WPTPoker.com account to a partypoker.com account.

The poker room will cease to run from June 3rd however players will have a further 3 months to withdraw their cash balance. During this period we will remove withdrawal limits. The fee will not be waived.

We understand the frustration and apologize for the inconvenience.

We also appreciate the time that players gave to WPTPoker.com. Thank you.

Players will not be allowed to transfer their funds to their partypoker account, players will have three months grace to withdraw their funds, and even if you have been hibernating for longer you can still withdraw your monies albeit through manual request to WPTPoker. Tournament dollars and tickets will be refunded, and any live event packages will still be honored.

It’s believed that the sale is connected with the impending sale of bwin.party. Last week saw 888 Holdings and a joint bid by Amaya Gaming Inc./GVC Holdings both make a move to acquire the largest online gambling outfit in the world.

888 Holdings have a relationship with the World Series of Poker (WSOP), and Amaya Gaming likewise with the European Poker Tour (EPT), both rival brands of the WPT.