UK paper "Daily Mail" reports that Playtech Cyprus Ltd. (AIM:PTEC) is in talks with gambling giant Gala Coral Group Ltd. to provide Playtech's technology for its online bingo, sports betting and casino games. The talks come after Playtech settled its dispute with William Hill plc (LSE) regarding Playtech's stake in William Hill Online.
In a notice to the London Stock Exchange, Playtech said that, under the settlement William Hill agreed to withdraw an injunction against Playtech. The parties also agreed to give greater flexibility to their respective operations, including William Hill Online, which may open up further commercial opportunities for the parties, including the cancellation of the sole restriction regarding Playtech's ability to license its software.
The "Daily Mail" says that Playtech is seeking a software supply deal with Gala Coral, rather than a joint venture like Playtech has with William Hill. The paper adds that bookmaker Ladbrokes plc (LSE: LAD) is also considering a deal with Playtech.
The paper quotes a source as saying, "Gala makes money on its online bingo but its sport betting really punches below its weight. Now that Playtech is free to talk to other operators, everything pointed to a deal between it and Gala."
Gala Coral, which owns casinos, bingo halls and the Coral bookmaking chain, completed a complex refinancing but still has £2 billion of debt. It is ultimately planning to break itself up and sell some or all of the businesses but is likely to wait for market conditions to improve in the hope of gaining a higher price, and has already rejected a bid for its bingo business.
Gala Coral declined to comment to the "Daily Mail" on the Playtech talks.
Playtech's share price fell 1.7% in London on Friday to ₤3.09, giving a market cap of ₤748 million.
Published by Globes [online], Israel business news - www.globes-online.com - on May 15, 2011
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