In a most interesting twist of events, Empire Poker is launching legal action against PartyGaming after the latter decided to drop acquisition plans for its former poker skin.
According to a recent report from Reutuers, Empire is preparing legal action because of the breakdown of recent negotiations for PartyGaming’s acquisition of Empire Online. This just a day after reports came out that Empire Poker’s shares dropped 20%.
Empire Online is a former ’skin’ of Party Poker. Last month, Party Poker decided to eliminate its relationship with all of its “skins”. And after separating itself from the skins, PartyGaming then bought out two of the skins and said goodbye to a third, Coral Eurobet.
Andrew Burnett, head of mergers and acquisitions, sais Empire is posturing itself for a long legal battle with the online poker giant. “We’re not taking a decision to litigate lightly, but having taken that decision on good legal advice, then we will pursue it very vigorously.”
PartyGaming, however, does not see the action as a legitimate threat. One London analyst, on the other hand, see the whole thing as a case of sour grapes. “If the two biggest players in the industry (Sportingbet and PartyGaming) have looked at it and reached no deal, then the chances are Empire is misguided about its own value.”
It was Sportingbet that originally tried to purchase Empire for 269p per share, but the deal fell through. The valuation of the stock was dramatically lower by the time PartyGaming made its offer at 60p per share, which Empire could not recommend to its shareholders.
Empire Poker Shares Slid 20%
Empire Poker’s shares dropped 20% after rumors of acquisition bid by PartyGaming become less and less likely to take place.
The sell-off came 14 days after PartyGaming announced it had made an approach for the company.
Trading in Empire was active, with more than 15.4 million shares changing hands, or nearly twice the company’s average daily volume over the past 30 days.
PartyGaming shares fell 0.52 percent. Although 20.4 million shares were traded over the session, that figure is around half the company’s average daily volume over the past month. To learn more about Online Casino Singapore , click here.