Amaya Gaming buys PokerStars, Full Tilt Poker for $4.9B
Acquisition will turn Montreal-based Amaya into world's biggest online gambling firm
Montreal-based gaming company Amaya Gaming Group Inc. has agreed to purchase privately held Oldford Group, the owner of online poker websites PokerStars and Full Tilt Poker, for $4.9 billion.
The transaction will turn Amaya into the biggest online gambling company in the world. Shares in TSX-listed Amaya were up more than 40 per cent to $19.77 on Friday.
Those two websites are the world's most popular and profitable online poker brands, Oldford says, with more than 85 million registered players on desktop and mobile devices.
The online gaming market is estimated to grow by more than $13 billion US to reach $42 billion US by 2018. The next gaming frontiers are online casinos, sports book and social gaming, which have a combined global market potential of more than $25 billion US.
Oldford's gaming websites have made large inroads in a time when a lack of clarity in U.S. law about online gambling has kept the industry in the shadows.
But the websites have also lost a few hands along the way, with the parent company agreeing to pay more than $730 million in fines to the U.S. Justice Department in 2012 to settle allegations they were engaged in illegal activity. But neither Oldford nor the subsidiaries admitted any wrongdoing while paying the fine.
Isai Scheinberg, who founded Oldford with his son Mark, currently lives in Canada and remains under indictment in the U.S. after being accused along with 10 other online gambling executives in 2011 of bank fraud, money laundering and illegal gambling.
Both Scheinberg and his companies were accused of breaking a 2006 internet gambling law that prohibits companies from accepting payments for online bets where they are not legal.
The businesses in the new, combined company pulled in $1.3 billion in revenue last year.
The boards of directors ofall companies involved have unanimously approved the deal.
With files from The Canadian Press