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MGM and Boyd Gaming sign deal with bwin.party
Tuesday, November 1, 2011 : MORE BIG CORPORATE ACTION ON U.S. INTERNET POKER
Now it's MGM Resorts International and Boyd Gaming who are getting ready to enter the market with a European partner
In the United States, news breaking Tuesday in the mainstream media revealed that terrestrial casino operators MGM Resorts International and Boyd Gaming Corp. have signed an agreement to partner with bwin.party online poker operations should internet poker be legalised in the USA.
The agreement would see the three companies take a stake in a new entity that would operate online gambling under the well-established Party Poker and other brands.
In October bwins.party's co-CEO, Jim Ryan hinted at the deal when he revealed that he had been spending some time on business trips negotiating a deal with major American corporates.
On Tuesday, Ryan told the Associated Press new agency that his company, which also owns the World Poker Tour, has been hoping to return to the U.S. market, which it left in 2006 as a result of the UIGEA.
Party Gaming had an estimated half of the U.S. market at the time and took a severe knock as a result of its exit; it has subsequently cleared the legal slate with the Justice Department, paying a large settlement for its pre-UIGEA American activities..
"We have been putting in place the foundation, if you will, to re-enter the market," Ryan said, adding that the new business will build a large enough pool of players to make the business profitable.
MGM Resorts CEO Jim Murren told Associated Press that it will be important to have tough new online poker laws because companies that now offer poker online to Americans have hurt the entire gambling industry's reputation.
"Whenever there's a problem anywhere, it reflects poorly on the gaming industry, of which we are a major player," Murren said. "The federal government needs to address this. It cannot wish it away."
Ryan said he thought his company did the right thing in exiting the US, even as other operators appeared to flourish.
"Did we sit back and watch in envy and knowing full well that we (had) had 50 percent of the market at that point? Perhaps, but we never questioned our decision," he said.
In addition to setting up the new entity, there is provision in the deal for MGM Resorts and Boyd to use bwin.party software to run online poker sites under their own brands.
Boyd CEO Keith Smith told AP he thinks it's important for the companies to be able to move quickly if the law changes, enabling them to access a market that has been estimated at $6 billion in value.
Bwin.party is licensed in France and Italy and is pursuing online gambling licenses in Spain and Denmark, Ryan revealed.
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