With an eye on the legalisation of online gambling in the United States, bwin.party announced that it is close to securing several strategic partnerships with US-based interests. Co-Chief Executive Jim Ryan said the company was in contract negotiations at the federal level and with interests in states with prospective legislation in place. Ryan, who helped negotiate Party Poker’s $105 million non-persecution settlement with the Department of Justice, stressed that negotiations were for partnerships only, not acquisitions.
In a conference call Ryan said: “We have made the decision to target strategic partners. At federal level, we are finalising agreements with a couple of parties positioned nicely to operate in that market. In California, we are well advanced with a particular party. The same in New Jersey, consistent with where we are at a federal level.” In response to a question from JP Morgan’s Vaughan Lewis about acquiring the assets of Full Tilt, Ryan said the company is “not looking at the business and have no plans of looking at it.”
The announcement of pending partnerships is not surprising. Considering that potential legislation will likely favour US-based interests and shutout overseas operators as business-to-customer (B2C) operators, Ryan has always seen business-to-business (B2B) contracts as an essential hedge against protectionism in newly regulated markets. If bwin.party can profit as a business-to-business and a business-to-government operator, this will suit the company. Co-Chief Executive Norbert Teufelberger told eGaming Review in August 2010 that withdrawing from the United States would be “the biggest mistake I ever made” if PokerStars and Full Tilt were not frozen out of a regulated market.