Online casino and poker room operator 888 confirmed today that it has been in talks with third parties since prohibitive Internet gambling legislation passed through the United States Senate in late September. Several reports have indicated that the company is in preliminary talks regarding a possible £1.6 billion ($3 billion) merger with industry rival PartyGaming.
"[888 has held] various preliminary discussions with third parties following the suspension of its U.S. activities," the company said, adding that it was unclear as to whether the discussion would proceed to an offer being made for the company or any other actions.
One source close to 888 said that the talks had not progressed beyond "a coffee and a chat."
Another industry source said PartyGaming was also pursuing other options, but a deal with 888 would have obvious benefits. "Casino and poker are the mainstay of both businesses," he said.
Execs from the two companies are expected to hold further discussions in the coming weeks, as online gaming operators mull over options to combine their online player pools after the U.S. Net gambling crackdown.
Since dropping out of the FTSE 100, PartyGaming has made no secret of its desire to seek a deal with a rival company to strengthen its business. CEO Mitch Garber said in a recent interview that consolidation was the "most sensible way forward" and told analysts he was in talks with several companies. London-based paper The Guardian reported that the London Stock Exchange (LSE) may force a statement as early as today.
Neither Party nor 888 have commented publicly on the merger discussions.