Playtech in $1.75 Million Deal with MixTV

14 August 2008

Playtech Ltd., a veteran of the live video-stream gaming space, has shelled out $1.75 million to acquire MixTV, an Israel-based subsidiary of Nevada's Win Gaming Media Inc.

MixTV provides technology for the delivery of mass-multi-player live-gaming applications; the deal, therefore, supplements Playtech's existing live-dealer offering with a mass-participation, live-TV product.

James Hollins, an analyst with Daniel Stewart & Co. in London, called the deal a low-cost and sensible one for Playtech.

The London-listed software supplier has been on the live-gaming scene since 2003, when it launched Live Gaming System in conjunction with one of its affiliates, and in 2004 opened Live Gaming Facility, which targeted the Asia-Pacific region.

Richard Carter, an analyst with Numis Securities, projects the MixTV deal will contribute $3 million in earnings before interest and taxes in the 2009 fiscal year, rising to $10 million in 2010.

For our readers not familiar with the live-gaming model, Playtech's product, for example, uses video-streaming technology to show a dealer spinning a roulette wheel, dealing cards or throwing dice in real time.

Historically, the model has been successful with high rollers and other players who value the ability to see the dealer's moves, live, at all times. The personal nature of the interaction between dealer and player, meanwhile, helps replicate the experience of gambling in a land-based casino.

Separate from the MixTV acquisition, Playtech announced it was continuing to conduct due diligence on one of its affiliate companies.

According to the company's prospectus, released ahead of its initial public offering on the London Stock Exchange in 2006, all but one of the affiliates are ultimately controlled by Teddy Sagi, the company's founder and largest beneficial shareholder.

Financial sources have told IGamingNews that Playtech could pay as much as $75 million to $80 million for the affiliate business. In mid June, the company raised $209 million in a heavily oversubscribed placing to fund acquisitions.

Financial details of the MixTV deal were not disclosed.

Chris Krafcik is the editor of IGamingNews. He lives in St. Louis, Mo.