William Hill, Playtech to Save Joint VenturePublished March 15, 2012 by OCR Editor
Two online gambling operators suffered a breakdown in relations last year.
William Hill and Playtech will begin talks this month to salvage their companies' online joint venture following a dramatic breakdown in relations last year, several news agencies have reported.
Finding a Solution
Executives from Britain's leading online gambling operator William Hill and the Israel-based software provider Playtech - which owns a 29 percent stake in William Hill Online - will discuss whether to close the curtain on their joint venture or to find an alternative path, a source close to the situation said.
Playtech CEO Mor Weizer said he was looking forward to holding discussions "as soon as possible," adding that it is vital all options are explored - including structural changes to the joint venture. He indicated that he was not opposed to hearing new suggestions from his partners at Hill.
William Hill wants to end Playtech's veto over acquisitions and receive a commitment that it will not work with arch-rival Ladbrokes - who are believed to have approached Playtech in the past.
Last Year's Dramas
The dramas began last year when Hill took out an injunction in February 2011 to prevent Playtech from selling its stake in William Hill Online. Later Playtech used its position within WHO to veto Hill's purchase of mobile betting operator Probability.
William Hill CEo Ralph Topping flew to Tel Aviv last September to personally end a dispute over allegations the company planned to relocate its online operations to Gibraltar. Around 300 online and customer service staff in Israel, Bulgaria and The Phillipies walked off the job at the height of the dispute.
2012: Decisive Year
November is shaping as the deadline for talks, as William Hill has until then to activate a call option to end the joint venture and buy out Playtech's stake at a price to be determined by a panel of three banks. Playtech's stake was valued at £354 million in a report by UBS, Deutsche Bank and JPMorgan, and Hill may not be able to raise the capital for a buy-out.
The two companies began their online partnership in 2008 when Playtech paid 250 million euros for its stake in WHO in return for providing personnel and software for online casino and poker games. The venture has been a success, becoming one of Europe's most formidable online gambling operations.