The rumor that PokerStars and Amaya Gaming are discussing the various possibilities of joining forces to control a larger percentage of market share has led to several speculations.
Amaya Gaming, the owner of Ongame Poker Network, supplies casino gaming software to several online casinos, many of which are in New Jersey. Amaya Gaming, therefore, would be an excellent acquisition for any company that is trying to enter a regulated online poker markets in the US.
However, merging PokerStars with Amaya Gaming is not that easy. So far, PokerStars has been unable to enter any regulated market in the US. It could not enter Nevada because of its bad actor clause. While Delaware preferred to license 888, NJ regulators suspended its license application for either two years or till the company announces certain major changes. PokerStars has formed an alliance with powerful operators in California in hopes of keeping a bad actor clause out of the state’s online poker bill. Owing to its difficulties in getting a license, PokerStars could be trying to find another solution to the problem, such as a merger with Amaya.
There are rumors that any merger between PokerStars and Amaya Gaming would be in the form of asset purchase or reverse takeover. This means that Amaya Gaming would get complete control over PokerStars’ assets.
Currently, it looks as if PokerStars is worth more than Amaya Gaming. It could also be possible that PokerStars is worth less than Amaya if it has unknown debts. It is also worth noting that, while PokerStars is held by private individuals, Amaya Gaming is publicly traded.
If Amaya Gaming’s value is lower than PokerStars’, it would require cash, which would be acquired by either borrowing money or issuing shares. In case a loan is required, part of it would be provided by shareholders at PokerStars. In this case, PokerStars’ shareholders will either hold debt or get part ownership of a new company.
There is also another problem associated with such a merger. California’s online poker bill includes a bad actor clause that would exclude from the market even player databases and software obtained from companies that continued to offer real money online poker services within the US after the passage of the UIGEA of 2006.
Since Amaya Gaming supplies software to almost all online casinos based in New Jersey and also owns the Ongame Poker Network, getting into any deal with PokerStars would have a negative impact on its ability to get a license.