Monday, July 15, 2024

Will Entain Keep PartyPoker? If Yes, That’s Great News for BetMGM Poker NV

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Will Entain Keep PartyPoker? If Yes, That's Great News for BetMGM Poker NV
Raymond Bryson, Creative Commons Attribution 2.0 License

Did Entain change its mind about selling PartyPoker?

Recent developments suggest that it has, and that’s encouraging news for the future of BetMGM Poker — especially in Nevada, where the company has long been interested in launching a real money online poker platform to compete with WSOP NV.

Let’s break down what’s happening and what it means for BetMGM Poker NV:

What’s this all about?

Entain, the UK-based gaming conglomerate that owns half of BetMGM, announced Monday that it has concluded a strategic review of its assets and found that it can do just fine without Crystalbet, an igaming brand in Georgia (the European country). It will likely sell Crystalbet soon.

Note: MGM Resorts International owns the other half of BetMGM.

Okay. So? 🤷🏼‍♂️

Well, two months ago, Entain was reportedly interested in selling PartyPoker, among other things. Entain is a big company with lots of subsidiaries and igaming brands — including Coral, Enlabs, Eurobet, Foxy, Ladbrokes, and SuperSport.

But in a statement Monday, Entain said nothing about selling PartyPoker. The company said it had completed a strategic review it started in January and decided to part with Crystalbet, but nothing else.

This is great news because, if Entain has determined that PartyPoker was a “non-core” asset, it could have led to the demise of BetMGM Poker.

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Did Entain change its mind about selling PartyPoker?

It appears that way, yes. The board at Entain could always change its mind down the road and sell PartyPoker, but for now it appears that the threat of a sale has passed.

What does PartyPoker have to do with BetMGM Poker?

PartyPoker software powers the BetMGM Poker platform. The software has allowed the operator to open online poker rooms in Michigan, New Jersey, Ontario, and Pennsylvania. It would also support BetMGM’s initiative to offer online poker in Nevada — and that appears to be among the reasons why Entain is hanging on to PartyPoker for now.

Note: Since Entain owns the software, PartyPoker also powers the online poker rooms for other Entain brands, like Bwin Poker.

Did Entain say anything about launching BetMGM Poker NV?

Not directly, but Entain did say that its capital allocation committee, the entity that conducted the strategic review for the board, found “significant upside by focusing on delivery of the Group’s strategy of returning to organic revenue growth, expanding margins and winning in the US.”

Entain said it wants to “win in the US,” but aren’t they just talking about sports?

We don’t think so — although it’s true that Entain did say it made progress on “delivery of the product roadmap for BetMGM” and referenced Angstrom Sports, the data analytics firm it purchased last year for £203 million (then worth about $265.7 million USD).

Sports wasn’t all Entain had to crow about. Right after it mentioned Angstrom, the company said the Nevada Gaming Commission (NGC) had “unanimously approved the applications of Entain and certain of its subsidiaries without limitation.” That includes Entain’s application for an interactive gaming service provider license for its PartyPoker software.

With MGM getting its license extended by Nevada regulators in April, and Entain receiving a license for its PartyPoker software this month, BetMGM Poker NV appears closer than ever to becoming a reality.

What could happen if Entain decided to sell PartyPoker?

Here’s where things get a little worrisome. If Entain were to change course and sell PartyPoker later, we see three scenarios:

  • MGM acquires PartyPoker and its underlying tech
  • Another operator acquires the tech and leases it back to BetMGM
  • Same as above, but the operator decides not to lease the tech

The real danger lies in that third scenario. It would likely spell the end of BetMGM Poker — unless it found another supplier, which would be highly unlikely.

Uh oh 😨. Have any of BetMGM’s rivals expressed an interest in PartyPoker?

Not up to this point — at least, not publicly. DraftKings is usually mentioned as a potential suitor but this would be bad news for online poker fans since DraftKings has never expressed any interest in offering online poker anywhere. You may recall that DraftKings tried to acquire Entain in 2021. Having failed that, it grabbed Golden Nugget Online Gaming that year to the tune of roughly $1.56 billion.

Would DraftKings have the money for PartyPoker, too? Maybe. PartyPoker was valued at about £4.6 billion ($8.6 billion USD) back in 2005, according to the industry newsletter _Earnings+More. It’s not worth anywhere near that today.

Got it. Wow, so this really sounds like good news 🥳!

Yes, we think so. Stay tuned, of course. Entain said it would provide more information in August with its interim results.

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