PartyGaming to bid for Empire Online

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The board of the world\’s largest online poker operator confirmed to have made a preliminary, non-binding approach, to its rival Empire Online.

Any offer proposal would depend upon PartyGaming being satisfied to a number of material pre-conditions, including due diligence and the outlook for Empire\’s business.

Empire Online has already been approached once this year when it received a £790m bid from Sportingbet, but the talks broke down in September after due diligence was completed.

The Dow Jones news agency, quoting sources close to the situation, suggested that PartyGaming could offer up to £400m, a figure that several industry analysts found surprising as they believe any offer would be considerably lower than the rumoured price.

“Empire is just 30 or 40 marketing people,” said one analyst who declined to be identified. “That means PartyGaming would be paying 10 million pounds per person.”

ABN Amro analysts said they saw little reason for PartyGaming to buy Empire.

News of the approach propelled Empire Online shares 8.5p higher to 124p.

In separate news, Gala is to move its Coral Eurobet online poker operations away from PartyGaming\’s software platform.

The move would definitely hurt other skins using the platform by reducing their liquidity.