|
By Kate Hilpern
October 10, 2005 - (The Independent) -- Trident Gaming, the provider of online gambling services, is on a roll and it wants to keep it that way. In July, the Isle of Man- based company made the headlines as a result of its acquisition of Gamebookers, one of the top 30 internet gambling firms in the world, serving clients from 123 countries.
So successful has the acquisition been that Trident now feels ready to look at a possible stock market listing. With next spring as its target, the company is after advice on how best to prepare for a flotation.
'We started out in 2001, building sports betting solutions,' says chief executive John O'Malia. 'Since then, we have been growing more or less organically and establishing our product, BetBug, which due to its unique design and regulatory profile is the only way to offer sports betting legally in the US market.'
Indeed, so steady was the progress that Trident's workforce remained at 12 for nearly four years. But the acquisition of Gamebookers, which employs 65 people, has led to rapid growth. 'Gamebookers will have turnover of about EUR180m (pounds 122m) this year and earn about EUR11m in revenue and EUR5.5m to EUR6m in profit. So we have had a very big leap on the learning curve,' explains Mr O'Malia, who began his career as a City trader.
Trident financed the move using a pounds 20m convertible loan from a hedge fund. 'It was very important for us to fund the deal in a way that allowed us to control all the variables and make sure it got done,' he says. 'Subsequent deals in the market have shown that similar assets are valued much higher than our acquisition price, which lends support to our reasoning on why the purchase was attractive.
'Now we are in a position where we would like to take the convertible debt and roll it into equity. After all, the cost of capital with equity funding in the current market is lower than the cost of the debt financing that we put in place.'
He cites a further reason for looking at a flotation, or initial public offering (IPO), as an option: 'A key challenge for Trident is keeping up with the consolidation in the market and remaining a player as companies jump from being worth $50m (pounds 28m) to $100m to $250m via acquisitions of their own. We have to make sure we are structured in a way that we can take advantage of this and be part of that trend. In this climate, that in effect necessitates a public equity structure.'
Mr O'Malia has two main dilemmas. 'First of all, how do I manage the risk in the IPO process in order to roll with the punches of the market? Right now, gaming stocks are all the rage, but it will not necessarily always be so. How, then, do we manage that uncertainty?' [...] |
ENJOY OUR NETWORK: SortCasinos | SortOnlineCasinos | Gambling-Pro
Newsfeed Service! | Casino Affiliate Programs
