Crown/AGT Deal Brings another Big Player into the Mix

16 January 2002

Traditionally a land-based slot machine manufacturer, Ainsworth Game Technology (AGT) announced Wednesday that it has agreed to provide Kerry Packer's new online casino with a suite of casino games.

Under the terms of the deal AGT will provide, which launched earlier this month, with exclusive games for the site. The partnership marks AGT's first venture into the online gaming arena.

Published reports in the Australian press after the deal predicted AGT would use the PBL deal as a springboard for further involvement in the interactive sector, but a company spokesperson said those are off base.

John Houston, AGT's marketing manager, said the agreement is more about continuing an established land-based relationship the company already has with Packer's Publishing & Broadcasting Ltd. group, which operates Crown Casino, one of Melbourne's biggest land-based operations.

"This is more about us just carrying on with the service we provide to them with our land-based machines," he said. "We aren't ready to actively pursue the Internet as a market for our product."

While AGT will develop games that will be exclusive to, PBL is free to source games from any supplier. The table and slot games now offered by were developed in-house at PBL.

AGT is one of Len Ainsworth's companies. Ainsworth has been able to amass a sizable chunk of the Australian gaming market with his video poker and slot machines, which are immensely popular in Australian casinos.

Ainsworth's association with the Packers dates back to the mid 1990s, when he still held a stake in Aristocrat Leisure, the poker machine manufacturer he founded in 1952.

Kerry Packer approached Ainsworth about buying out Aristocrat just before it went public in 1996. Ainsworth turned down the offer and instead passed his Aristocrat holding to his family the following year.

Ainsworth returned to the poker machine industry in 1999, when he established AGT, of which he owns 56.5 percent. A December float of the company raised $50 million.

Analysts also predict the Crown deal may be angled more toward Ainsworth getting his land-based games into the Crown casino property. Boasting 2,500 poker machines, Crown Casino represents an attractive market into which AGT could sell its flagship Ambassador machine.

"The biggest upside is establishing a relationship with Crown," UBS Warburg gaming analyst Anthony Aboud told the Sydney Morning Herald. "They're hoping on the other side of the ledger they'll get a good order flow from Crown."

PBL Gaming chief Andrew MacDonald feels the agreement with Ainsworth is critical in improving the quality of play on

"The next stage of the rollout is to further develop and expand our range of table games and slots, and the agreement with Ainsworth Game Technology will move things along significantly," he said.

MacDonald said had received an "encouraging response" from gaming players since the Web site went live on Jan. 3.

To comply with the Australian government's ban on Internet casinos, PBL established its Internet casino in Vanuatu and bars Australians from accessing the site. It doesn't take wagers from American or players located in New Zealand either; instead the site targets Asian players.

Although company officials are saying AGT doesn't plan to pursue the online gaming industry right away Jim O'Mahony, the company's CEO, acknowledged in a press release that the deal does lay the foundation for a strategic approach.

"This agreement allows us to enter the international Internet gaming market," he said. "Our extensive expertise and cutting-edge technology will provide with a variety of games offering revolutionary graphics and increased player entertainment."

He added that, with the Web site's operations based in Vanuatu, AGT remains in line with government regulations.

"The agreement allows us to expand our range of games but will not conflict with its existing customer base," he said.