Playtech Shells Out $50mm For Super Affiliate PokerStrategy
The online poker industry got a bit smaller today.
Playtech, the company behind the platform for the iPoker Network, has agreed to acquire online gambling super affiliate PokerStrategy.com.
The purchase price is said to be in the range of €38mm, or about $50mm in USD.
Terms of the deal were not released, so it’s not known if the purchase also includes other properties operated by PokerStrategy parent company Etruvian, such as their forex community Tradimo.
In a statement, PokerStrategy stressed their plan to “maintain its independence” post-deal. PokerStrategy also indicated that they intend to work closely with Playtech to improve the iPoker software.
Role of combined company is U.S. market unclear
It will be interesting to see what approach the combined company takes to the U.S. market. On one hand, some have speculated that Playtech has basically given up on entering the market due to regulatory concerns.
But on the other hand, PokerStrategy is a completely “clean” site, having never promoted U.S.-facing rooms, and would likely have little trouble acquiring an affiliate licenses in the regulated U.S. market.
Reaction to the deal
Playtech’s stock was up over a point and a half on the news.
Some felt the price was something of a steal for Playtech:
@InfiniteEdgeKim the timing is necessary. 'Good timing' would have been selling for 3x on many previous offers
— Mike O'Malley (@rzitup) July 11, 2013
Playtech just bought Poker Strategy for €38.3m which did €19.5m in EBITDA in 2012. That is less than a 2X multiple #PlaytechStrikesAgain
— Chris Porter (@CM_Porter) July 11, 2013
Initial reaction from the PokerStrategy community was mixed.
User nooni2k summed up the general tone, saying: “Not sure how I feel about this. Would like to see a substantial, detailed post from PS about what the implications of this will be. Particular focus of what/when/how they will be working with iPoker on software issues would be good. Also what influence iPoker will exert on PS’s independence. This could end up being a good thing if PS influences iPoker, or a bad thing if iPoker influences PS.”
