PartyGaming buys Empire Online assets for 250 mln usd; settle legal spat

[clevfan]

PartyGaming buys Empire Online assets for 250 mln usd; settle legal spat

02.14.2006, 01:56 PM

LONDON (AFX) - British online gambling group PartyGaming PLC has agreed to buy the so-called skin activities of smaller rival Empire Online Ltd for 250 mln usd in a deal to settle a legal spat.

Empire in December filed a lawsuit claiming 'substantial' damages after its bigger rival on Oct 8 ringfenced its own gambling platform from that used by partners. The move culminated in a profit warnings from Empire.

A judge last week instructed the two companies to reach an out-of-court settlement.

PartyGaming said the deal, which is conditional on approval from Empire's shareholders, will add to earnings in the current financial year.

It will incur a non-recurring charge of around 150 mln usd in the year ended Dec 31 on the settlement of the dispute.

Empire meanwhile reaffirmed its forecast of a 37 mln usd net profit from its continuing businesses this year.

It added that shareholders representing 56 pct of its shares have backed the deal with PartyGaming.

Noam Lanir, chief executive of Empire, said the deal puts the company on a stronger footing and will enable management to focus on future growth.

'We will consider carefully how to use the net proceeds from this sale to the maximum benefit of shareholders,' he said in a statement.

[Triplecrown]

wasn't this less than the original buyout offer? i think it is. if so this is what happened. when empire tried to squeeze too many dollars out of PP when PP tried to buy them out originally; PP got upset and flexed their muscles, emasculated the empire skins, whichin turn reduced the value of empire (thus reducing the buyout/settlement price). if this is so then PP showed some tough but admirable business skills. if i'm wrong in any of this summation, please feel free to correct me.