Bwin.party has confirmed that Shuffle Master has withdrawn from its purchase of the group’s Ongame poker network.
In an announcement to the London Stock Exchange, bwin.party announced that the two companies had “mutually agreed not to proceed” with the transaction.
Shuffle Master had announced in March that it planned to acquire Ongame as part of its efforts to expand its online product offering. The company agreed to pay bwin.party €19.5m in cash and up to €10m within five years of closing.
Earlier this month it signed agreements alongside Ongame with leading slot manufacturers Aristocrat and Bally Technologies.
"We remain ardent believers in the growth opportunities for online gaming and continue to focus intensely on the space," said Gavin Isaacs, Shuffle Master CEO. "When we signed the definitive agreement in February, we believed that general market conditions and Ongame's sales pipeline supported the purchase being neutral or modestly accretive to the company's EBITDA. Business conditions in Europe have deteriorated since February and as a result, it has become evident to us that Ongame's operations post-acquisition will not achieve the near-term results we initially expected and will require a larger ongoing investment than anticipated."
There is also uncertainty, he said, over the timing of the legalisation of online poker in the US.
Following the decision, bwin.party said it would begin talks with other interested parties.
“The sale of surplus assets, including Ongame, remains a core part of bwin.party’s strategy,” it said in the announcement. “bwin.party is re-engaging with other third parties that have expressed an interest in acquiring Ongame.”
