Mystery bidder lines up Empire pitch

Gaming operator Empire Online today suggested its spell on the stock market could be short-lived after revealing a £790m (€1.2bn) takeover approach.

Empire, which makes its money from directing players to poker and casino websites, did not name the company behind the approach which came just two months after its flotation on the London market.

The talk in the market centred on PartyGaming which already has a deal with Empire to market some of its poker websites and could generate savings from combining the businesses.

Poker accounts for around two-thirds of Empire’s business while casino makes up for the remaining third. The proportion from poker is set to rise since it is the fastest-growing sector of the online gaming market which is expected to turn over $12bn (€9.6bn) this year and double this amount by 2010.

In a statement today, Empire noted the recent movement in the price of its shares that were listed at 175p in June and had risen to 245p by the start of trading today.

Investors buying the stock today pushed Empire shares to 270p, which the company confirmed was the price that its suitor was willing to pay.

“The approach is subject to a number of pre-conditions, including completion of satisfactory due diligence,” Empire said.

“The board of Empire Online has commenced discussions with the interested party, but these discussions are at an extremely early stage and there can be no guarantee that an offer will be made for the company at 270p per share or at all.”

Empire was founded by Israeli businessman Noam Lanir in 1998 and last month said pre-tax profits rose 87.5% to $25.5m (€20.3m) during the first six months of this year.

The boom in internet gaming was underlined today when online money transfer firm NETeller announced that half-year profits had more than doubled to $40.6m (€32.4m) and it now had 1.75 million members.

Yesterday it was also confirmed that 888 Holdings – the world’s largest internet casino operator in terms of visitor numbers – was aiming to float on the London Stock Exchange with an expected value of around £700m (€1bn).

In a different statement, Empire said it had appointed Andrew Burns, the former finance chief of nightclubs business Luminar, as its new finance director.