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888 Holdings buys Wink Bingo

22.12.2009

One of our favourite online gaming guru’s; the well respected 888 has just purchased another of our fave online bingo sites - Wink Bingo - for a preliminary cash payment of £11m with more to follow. It is reported 888 could fork out as much £60m as part of the final deal, dependant on the forthcoming growth of the Wink business.

The brands that sit under the Wink umbrella include Posh Bingo as well as Bingo Fabulous and are considered some of the dominant operators running on 888's Dragonfish bingo network.

According to Daub Ltd; (Wink Bingo’s parent company) – they boasted a combined record of 60,000 active bingo players in October 2009. Daub Ltd recorded pre-tax profits of £1.3m year ending 30 November on revenues of £15 million. The company had gross assets of £1.6m.

Broadly speaking, the acquisition of Wink to 888 has been more than just a rumor within the online bingo world for some time and was anticipated because, with Wink Bingo and Posh Bingo being such a significant part of the Dragonfish bingo network, a potential move to another software operator could have put 888's entire b2b strategy at considerable risk.

It is also believed that Wink Bingo's founders possess a close relationship to the 888 management since they founded Globalcom software which is used to power 888's online bingo business, a relationship which would surely have facilitated talks of a sale.

Gigi Levy, the CEO of 888 Holdings said: “We are thrilled to announce the Wink Bingo acquisition as part of an extension of our Business to Consumer bingo path in the profitable UK market. The Wink team has a proven track record of quality marketing, Customer Relationship Management and implementation and will be a great addition to our developing bingo business. Plus, the deal is financially attractive and will be profit enhancing.”

The earn-out portion of the contract means that almost £48m could be paid out by the Summer of 2011. However, for that to happen Wink Bingo's profits would need to grow to about £9 million per annum, which at this stage, seems unlikely.

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