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Empire Online shares fall following negative press



Printer Friendly VersionPost a CommentTell a Friend about this Article17 June 2005
As reported by: eGaming Review
Shares in newly listed egaming firm Empire Online fell by nearly 15% as the firm felt the backlash from negative press stories over PartyGaming.

Empire, which derives the majority of its income from a white label of the Party Poker website, and had seen shares rise 8% in its first day of trading.

But a series of stories surrounding the perceived illegality of online poker in the US, where both firms derive the majority of their revenue, put the dampeners on that early enthusiasm.

Shares fell to as low as 149p from the initial listing price of 175p, knocking more than £70m off the valuation of the firm, before finishing the day on 157.5p.

Investors reacted nervously to the news PartyGaming had cut its valuation by over US$1bn amid rumours investors were demanding a discount based on regulatory risk.

The dip in fortunes followed a successful listing that raised US$222.25m for the group, with the majority of this being used to buy shares from the founders.

The firm retained around US$32m of the proceeds, which it plans to use to finance a major European marketing drive.

Empire also said it would consider strategic acquisitions, which may include software and technology firms alongside other casino and poker sites.

“The placing and flotation on the alternative Investment Market market of the London Stock Exchange will enable us to consolidate and build on our rapid growth,” Noam Lanir, chief executive, said:

Empire describes itself as a marketing company, and has white-label and affiliate sites for both the Party Poker.

Empire Poker had 91,549 active real-money poker players as of March 2005, from a total of 144,000 players recruited since the launch of the site in November 2002.


Article By: eGaming Review

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