English Harbour Online Casino Group Takeover
Published: Saturday, November 12, 2005 Online-Casinos.com
ENGLISH HARBOUR ONLINE CASINO TAKEOVER STORY IS TRUE
Leisure and Gaming pays US$ 80 mill for casino group and sportsbooks
The rumours flashing around the industry last week (see previous Online-Casinos.com & InfoPowa reports) are true - veteran online casino group English Harbour, together with Nine.com group and its sportsbooks has been bought by Alastair Assheton's Gaming and Leisure group.
After days of trying to get a comment from L&G, the UK media broke the story Friday, reporting that online gaming company Leisure & Gaming PLC is to buy two of its rivals in deals worth up to US$ 80 million in an attempt to boost its position in the consolidating internet gambling sector, and is to raise GBP 24 million in a placing to fund the deals.
Leisure & Gaming is to buy Curacao-based Nine.com for an initial US$ 36 million in cash and shares, plus performance-related payments of up to US$ 21.1 million.
The recently re-branded Nine.com offers online sports betting, horse racing, casino gaming and poker, through brands such as BetCom and MyBookie.
The company is also picking up English Harbour, which was established in 1997 in Antigua as one of the first internet casino businesses, for an initial US$ 16.5 million in cash and shares, plus deferred payments of up to US$ 6.75 million.
English Harbour has its own proprietary technology, and a portfolio of brands including English Harbour, Silver Dollar and the Super Slots Casino, among others.
To pay the cash components and to meet the expense of the acquisitions, the company is to raise up to GBP 24.375 million through a placing of 19.5 million new shares at 125 pence each.
Leisure & Gaming said the online gambling industry remains a fragmented and evolving market with scope for consolidation, and English Harbour and Nine.com represent complementary acquisitions that will be earnings enhancing in their first full year.
Alistair Assheton, chief executive of Leisure & Gaming, said: "Nine.com's proven marketing abilities complement the group's foundation VIP business and its recognised strength in customer retention."
"The English Harbour business combines casino best practice to complement the enlarged group's core sports betting focus," he added.
Leisure & Gaming said that Nine.com had a total of 19,015 active customers as at June 30 2005, with revenues in the six months to June 30 of approximately US$ 91.3 million.
It added that in the nine months to Sept 30, English Harbour generated 12,076 new sign ups with an average customer acquisition cost of US$186.
Through its VIP business, Leisure & Gaming currently operates a number of online sports betting, horse betting, poker and casino gaming brands including VIPsports, VIPpoker, BetGameDay and FairDeal. The company recently changed to the Real Time Gaming software platform.
Detailing current trading, Leisure & Gaming said the VIP business is performing in line with management's expectations, while in the the key sign-up period from July 1 to Oct 15, VIP has seen a 55 percent increase in new customers compared to the same period last year.
Leisure & Gaming is not yet done with acquisitions - Assheton added it will continue to look at further suitable acquisitions.
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