Could Amaya Gaming be shut out of the sale process for Bwin.Party? Now that GVC looks more likely to bid by itself for Bwin after announcing GVC will raise 150 million pounds by issuing more share to the public and using the proceeds to re-ignite an offer for Bwin.Party. That GVC is considering going alone without the support of Amaya is bad news for Amaya shareholders. GVC seems to be getting good feedback from investment bankers regarding a secondary offering of their shares. This means investors see the benefits of a GVC/Bwin tieup without a Pokerstars connection, which means that one of the main benefits of of teaming up with Amaya (money) seems less important if GVC can raise the funds on its own.
Let’s say that GVC is able to raise money on their own and they beat out 888 for control of Bwin.Party, how will this change the online poker landscape? Pokerstars would still be the dominant platform, and it would still be cutting into ancillary revenue from its competitors in the form of sports and casino games. But since network effects are so strong in online poker, a buyout of Bwin without Amaya would open the door for even greater consolidation and stronger competitors. Its possible there could even be a tie-up between GVC/Bwin including 888 down the road.
Lurking in the background is Playtech’s iPoker white label platform, which would still be number 3 in the world by market share. 3rd party white label platforms are gaining more acceptance by operators in the online gaming market as the market matures and barriers to entry from technology and regulation continue to grow. I think iPoker is a bigger threat to Pokerstars than consolidation of smaller platforms as iPoker is a differentiated product.