Gala Coral CEO Neil Goulden revealed over the weekend in an interview with Financial Times that he would like to take the company public within the next year and half. "We are massively cash generative and have a growth profile that makes us attractive. We have had lots of public funds ask to see us. . . . There's clearly an appetite," Goulden said. "I have never been a private equity addict. By the middle of 2007 there will be more advantages in Gala being public than private." He added, "Of the three exit routes, one is an IPO. There is no doubt that the gaming industry is going to globalize. So the second exit route could be to roll Gala into a global gaming brand, such as Harrah's (HET.NYSE) or Tabcorp (TAH.ASX)."
Gala Coral was formed in October of 2005 when bingo halls and casinos operator Gala purchased Coral Eurobet--a bookmaker that also operates dog tracks and online gambling services--for £2.18 billion. Gala was owned by three private equity groups--Candover, Cinven and Permira--which all held equal stakes in the firm. To finance the purchase of Coral, each stakeholder has increased its investment by £275 million. Gala Coral is now Britian's largest bingo operator (167 clubs), its third largest bookmaker (1,267 shops) and one of its largest casino operators (30 venues).
Fairground Gaming Makes First Acquisition
Fairground Gaming Holdings Corp. (FGH.L) has initiated its first acquisition with the purchase of the Spin Palace group of online businesses for an initial consideration of US$66 million with the possibility of an other $20 million dependent upon EBITDA performance. Spin Palace's online gambling sites include SpinPalace.com, RubyFortune.com, and PiggsCasino.com. Fairground Gaming raised about £8 million by floating on London's AIM in September of 2005. Headed by Evan Hoff, a former PriceWaterhouseCoopers accountant who founded I-gaming marketing firm forwardSLASH, Fairground Gaming's strategy is to acquire and consolidate online gambling properties.
Sportingbet Grows in Americas
Online gambling operator Sportingbet Plc (SBT.L) has acquired the business of HollywoodSportsbook.com for an undisclosed amount in an all-cash transaction. The Web site is expected to re-launch with a sports book that is run by World Gaming Plc's (WGP.L) software. London-based Sportingbet Plc is a holding company that provides strategic direction and policy for its subsidiary operating companies in the Australia, Europe and the Americas. The company's Web sites are tailored to the specific needs of the local market.
Crypto Shares up on Contract Extension
Shares in CryptoLogic, Inc. (CRY.TO) gained US$2.11 on the NASDAQ Friday after the company announced that it had extended a contract with its largest client--Overseas Internet Gaming Entertainment NV, operator of InterCasino.com and InterPoker.com--until 2012. Canaccord Adams analyst Greg Harris raised his first-quarter estimates for CryptoLogic, citing much growth in the industry in general in the first quarter. It is expected that William Hill will also renew its contract with CryptoLogic this year. Harris estimates that Overseas Internet Gaming Entertainment and William Hill represent about 80 percent of CryptoLogic's revenue. CryptoLogic additionally announced on Friday that the Ritz Club London Online had decided to cease its relationship with the company during or prior to October 2006.