The online gambling software provider will announce its acquisition of bwin.party’s “surplus asset” Ongame by the end of the week. A source close to the company told eGamingReview that the deal has been done for “two weeks” but negotiations have been ongoing for the last two months.
Amaya is expected to hand over close to the €19.5 million Shufflemaster agreed to pay in March before calling off the deal three months later. “Business conditions in Europe have deteriorated since February and as a result, it has become evident to us that Ongame’s operations post-acquisition will not achieve the near-term results we initially expected and will require a larger ongoing investment than anticipated,” Shufflemater announced in a press release.
Potentially putting pressure on the €19.5 million price tag: IGT’s decision to shut down its poker network last week. Analysts told PokerUpdate that the company plans to write off its £70 million purchase because “offloading it in a sale would prove too difficult.” IGT acquired Entaction in May 2011 for £70 million.
According to affiliate sources, it is estimated that Ongame loses nearly €1 million per month. Bwin paid €474 million to acquire the network in 2005. Less than a year later the Unlawful Internet Gaming Enforcement Act (UIGEA) was introduced, forcing the company to withdraw from the US market.
Amaya has been on a buying binge of late, acquiring online games manufacturers Chartwell in May 2011 and CryptoLogic in February this year. Both Amaya and bwin.party declined our requests for comment.