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Ipo For Pokerstars

The Scheinberg family has been subject to a variety of rumours involving the potential launch of an IPO for the Pokerstars online poker room. Since January of this year, the possibility of an IPO being implemented has increased in the minds of many observers, especially when the company decided to hire one of the leading brokers in London.
The broker was the well-known NM Rothschild which had the task of investigating whether to sell Pokerstars, or whether the Scheinberg family should launch an IPO. Although the speculation was rampant at this point, it suddenly died away and was forgotten, until this week where the London Stock Exchange IPO came to light yet again.
The media has so far been unable to discover whether an IPO has indeed been given the go-ahead or not. Pokerstars, which the Scheinbergs own with a 75% stake, has also remained tight-lipped on the subject.
The Scheinbergs, who were originally from Israel, would raise anything from US $2.5 billion to US $3 billion if they launched an IPO, according to expert industry analysts. The value they have placed on Pokerstars is in the range of values placed on its major competitors of 888 and Party Gaming, amongst others. Overall, it places Pokerstars as the 2nd largest online poker room in the world, which generates the Scheinbergs roughly $200 million per year in profit. Partly, this also comes as a result of its regular participation in promotions and tournaments with values of over one million dollars.

The London Stock Exchange in 2005 saw the online gambling industry make major gains, with some companies making their debuts. Excapsa was one major company which debuted on the London Stock Exchange, and Full Tilt Poker is currently in talks with financiers about whether to float itself on the London Stock Exchange.

For late March, or early April, an IPO for gaming software developer Playtech has been predicted by industry analysts. One of the major barriers to new IPOs, however, is the anti-gambling laws in the United States. European officials remain confident the ban on online gambling wouldn’t go through, as it’s such a major industry. Furthermore, observers have noted the rapid growth of the industry as a whole, which makes a ban highly unlikely. Reports said that in the last year alone online retailers earned revenues of $10.9 billion, and this report expects this to advance year on year.

Posted on: March 31, 2006

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