The world’s second-largest internet poker company is preparing to float on the London stock market before the end of this year with a value likely to exceed $2 billion (£1.1 billion), reports the “Sunday Times.”
The “Sunday Times” said that Pokerstars is understood to be in talks with a number of investment banks, including HSBC and Dresdner Kleinwort Wasserstein, about hiring them to work on the listing. Both banks are experienced in leading IPOs for online gaming companies. HSBC previously led the flotation for 888 Holding plc (LSE:888), the operator of the world’s largest online casino, while Dresdner floated PartyGaming (LSE: PRTY), the operator of the world’s largest online poker site. 888 is currently trading at a value of $1.4 billion while PartyGaming is traded at a value of $10.6 billion.
The "Sunday Times" reported that while no banks have yet been mandated, insiders said the company was gearing up for the process and was lining up advisers. “It’s early days, but this is a live situation. It’s up and running,” said one source, adding that there had been a number of meetings with banks.
Pokerstars, like its counterparts Empire Online Ltd. (AIM: EOL), 888 Holding plc (LSE:888) and Playtech (AIM: PTEC.L), is controlled by Israelis. The company’s controlling shareholders are Isai Scheinberg, who lives in Canada and an unknown Tel Aviv based businessman, Pinchas Shapira, who are believed to jointly control a 75% stake in the company, with the company’s employees owning the other 25 percent.
Pokerstars, which was founded seven years ago, operates the world’s largest online poker tournament. Last month, it crossed another milestone with the announcement that it registered its five millionth player, double the number of registered users a year ago.
Sources believe Pokerstars has annual profits of $150-200 million and will therefore trade at a value of $2 billion, reflecting a profit multiple of 10-13. PartyGaming, by comparison, is currently trading at an expected profit multiple of 16.5 for 2006.
Published by Globes [online], Israel business news - www.globes.co.il - on April 16, 2006
© Copyright of Globes Publisher Itonut (1983) Ltd. 2006