Big Moves At Online Betting Group, Betcorp
Published: Thursday, July 13, 2006 Online-Casinos.com
BIG MOVES AT ONLINE BETTING GROUP, BETCORP
A new acquisition and a switch in listing emphasis
Australian business media were this week reporting the latest moves at online betting group Betcorp, which is to delist in Australia in favour of more focus on the London AIM exchange, and spent $US9.76 million ($A13.08 million) on the acquisition of Oasis, a telephone and internet sports betting and internet casino based in Curacao, Netherlands Antilles.
Company spokesmen said that the emphasis on the group's London listing with effect from October 31 when the Australian delisting would take effect should stimulate greater investment and interest.
47 percent of Betcorp's issued shares are held outside Australia, and the Betcorp board feels that shareholders' interests would be better served by focusing on the UK listing, the spokesmen said.
Betcorp chairman David Hudd said: "Since the company was admitted to [London's] AIM, it has become clear that there is insufficient liquidity in the company's shares to support two stock exchange listings and the cost of doing so is excessive for a company of this size.
"The London financial market has continued to reinforce its position as the global centre of institutional interest in the online gaming sector," he concluded.
Earlier this year, Hudd was quoted as saying that the London market had an unrivalled understanding of online gaming businesses and it was expected that it would be at the forefront of corporate activity as the industry evolved.
The Oasis acquisition is expected to be "....immediately earnings enhancing," Betcorp said.
Oasis Casino and Sportsbook was one of the first offshore gambling companies targeting the U.S. market during a period widely viewed as the start of internet gambling (circa 1996). Over the last ten years, the company has grown impressively, with its casino operation in particular providing good results. The operation boasts some 56 000 registered customers, with over 5 500 active in the 12 months ended 30 June 2006.
For the year ended 30 June 2006, Oasis recorded unaudited gross revenue from players of US$7.4 million on turnover of US$278 million and net income of US$1.3 million.
Following the migration of Oasis onto the Betcorp operating infrastructure, the group said it expects to make annual net operating cost savings of over US$1 million by fully integrating its bookmaking, customer service, IT, finance and marketing resources.
In a statement, the group said it expects that the net contribution to earnings would represent an acquisition multiple of approximately four times.
