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U.S. land gambling giant MGM Resorts International is partnering up with bwin.party and Boyd Gaming Corp. to form an online poker company should the game be legalized within the American market.
bwin.party co-CEO Jim Ryan had previously stated he was traveling to negotiate a deal with American gaming companies, but no details were released until Tuesday. Ryan expressed his desire to return to the American market, which was abandoned shortly after the passage of the UIGEA.
Commenting on the deal, Ryan said: “Our strategy has been designed to address any and all legislative outcomes, whether federal or state-by-state. We are particularly excited to be working with MGM and Boyd. Combining their significant assets and regulatory expertise with the strength of our PartyPoker and World Poker Tour brands, all supported by our in-house technology, makes us perfectly positioned for any future opening of the US online poker market.”
Jim Murren, CEO of MGM Resorts also commented, saying: "MGM has long been supportive of Federal legislation to strengthen UIGEA and provide the needed regulations and consumer protections for online poker. MGM is proud to have bwin.party as our partner as they have the assets and experience that, combined with our brands, can ensure a secure, fair and entertaining online poker experience.”
A statement by bwin.party stated the conditions of the deal, and read:
"While there is no certainty that online poker legislation will be enacted in the US, bwin.party is preparing to enter into a preliminary suitability review in the State of Nevada," the announcement notes.
The agreements with MGM and Boyd are subject to enabling legislation and regulatory approval and include the following elements:
Business-To-Consumer (‘B2C’) Joint Venture In the event that suitable federal legislation for online poker is enacted in the US, bwin.party, MGM and Boyd will form a jointly-owned US-based company (‘Federal NewCo’) with bwin.party owning 65%, MGM owning 25% and Boyd owning 10%. MGM and Boyd will have representation on the Federal NewCo board. The funding required by Federal NewCo will be met by bwin.party, MGM and Boyd pro-rata with their respective shareholdings.
bwin.party will supply Federal NewCo with its primary online poker brands for use in the US - including PartyPoker and World Poker Tour. bwin.party will also supply a poker platform and all other required support services. The platform will offer players a safe, secure and fair gaming environment and will address problem and underage gambling as well as protect against other activities such as money laundering.
Should the US regulate online poker on a state-by-state basis, a stand-alone company will be established to develop each state opportunity (‘State NewCo’). The shareholders and shareholdings in a State NewCo may vary, depending on the state concerned and reflecting the contributions to be made by each shareholder. In addition to bwin.party, shareholders in a State Newco may include MGM, Boyd and other partners.
Business-to-Business (‘B2B’) Agreements Bwin.party will also enter into two separate, 15-year business-to-business agreements with MGM and Boyd that will enable them to offer real money online poker services under their own brands in the US using the bwin.party technology platform and associated services. Under the terms of these agreements both MGM and Boyd are exclusive to bwin.party and the Bwin.party will receive a share of the online poker revenue generated by those services.
Preliminary Suitability Review Bwin.party is preparing to enter into a preliminary suitability review with the Nevada Gaming Control Board in order to secure an advanced finding of suitability in anticipation of future US-facing real money poker opportunities.