|The world’s biggest Internet poker company has announced the appointment of advisers to a possible flotation on the London Stock Exchange that could value the business at about £3 billion. |
PartyGaming, the Gibraltar-based group that launched the PartyPoker website in 1997, has revealed the appointment of Dresdner Kleinwort Wasserstein and Investec Securities to advise the company on its “strategic options”.
Despite the likelihood of a place in the FTSE 100, the big banks such as Merrill Lynch, UBS, Morgan Stanley and Deutsche Bank declined the opportunity to be involved, eschewing fees of an estimated £20 million.
The difficulty is that PartyGaming’s biggest market is America, where the legality of internet gambling remains in doubt.
Last year the company reported earnings before interest, tax, depreciation and amortisation of about $350 million (£186 million). However its IPO valuation is likely to be based on projected 2005 earnings of as much as $600 million, implying a valuation of perhaps $5 billion to $6 billion.
PartyGaming’s marketing director said, “If we were to float in London there is a good chance we would be a FTSE 100 company.”
PartyGaming also has casino and bingo websites, although more than three-quarters of its business is derived from online poker, the fastest growing part of the gambling industry.