Investment bank Citigroup Smith Barney reiterated its buy rating and 185p target for PartyGaming and would like to see the world\’s largest online poker company acquire Empire Online.
“Consolidation is one reason why it [PartyGaming] floated and a deal could make financial and strategic sense,” said the bank in a review of the online poker company.
Empire Online, which finds online poker players who play on PartyGaming’s website PartyPoker in return for a revenue share, benefits from the liquidity offered by PartyGaming, while it has the option of taking the players to another poker room at anytime in exchange of a more favourable deal from the new partner.
“If PartyGaming bought Empire the inefficiency of competing with each other could be eliminated, Empire’s market share could be secured for PartyGaming and Empire’s successful non-US player recruitment could be expanded, reducing PartyGaming’s dependence on the US,” said Citigroup Smith Barney.
In separate news, EmpirePoker announced a strategic partnership with Extreme Poker, the company behind The Great Canadian Poker Tournament.
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