Amaya Gaming And PokerStars Announce Done Deal

The Amaya Gaming and PokerStars deal was first announced in June 2014. At that time it was stated that the deal would be completed by the end of September. However a press release from Amaya Gaming from its headquarters in Montreal on August 1 stated that the deal was done. The industry was caught unawares because no one expected all formalities to be completed two months ahead of schedule.

In the deal Amaya Gaming was to acquire 100% of the issued and outstanding shares of privately held Oldford Group, the parent company of Isle of Man-headquartered Rational Group, the owner and operator of the PokerStars and associated poker products in an all-cash transaction for an aggregate sum of $4.9 billion. It was a win-win deal for both parties and that is one reason why it went smoothly. The shareholders of Oldford Group thought that they were getting true value for the business and the Canada based Amaya thought that the business will generate more than what they were paying. Both parties had been honest upfront, so the due diligence did not reveal hidden skeletons. Neither party tried to weasel an extra slice of the cake in the process.

One of the factors driving the deal was regulatory pressure in the United States. PokerStars had to enter the legal American online poker market, which today consists of Nevada, New Jersey and Delaware. PokerStars has led the American market for a decade and one cannot conceive of a federally regulated market without this iconic online poker room. The US regulators specify that none of the earlier owners of PokerStars can be on board if the operator has to get an American online gaming license. Without an American license PokerStars has no long term future. Hence the total and clean break was essential.

On completion of the deal David Baazov, chairman and CEO of Amaya, expressed his satisfaction at the acquisition. He acknowledged that the Rational Group brands PokerStars, Full Tilt and the live poker tours and events comprise the world's largest poker business, generating diversified and recurring revenues across the globe from its extremely loyal customer base. He praised the group’s core values of integrity, customer focus, and challenge. Baazov said that Amaya Gaming would maintain this culture and will facilitate the continuing growth of this world class business. PokerStars would be run as before. There would be no job cuts in the PokerStars head quarter of Isle of Man nor would jobs be shifted to Canada.

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