An announcement that Party Gaming is buying Cashcade, the parent company of Foxy Bingo, Cheeky Bingo, Bingo Scotland and Think Bingo, is expected within days.
A source close to the deal told Bingo News that they were “days away” from completing the deal and that while the management teams had agreed the terms of the sale there was a large amount of legal due diligence documentation to complete.
A report in The Sunday Times this weekend was described as “not quite factually correct but not a million miles away” and “a bit premature”.
That report had said that Party Gaming would buy Cashcade for £100 million, of which £75 million would be an upfront payment and the remaining £25 million paid dependent on the company's performance over the next 18 months.
If the details are correct then it would value the company at just under seven times 2009 earnings, which are estimated to be £15.2 million.
The deal will give Party Gaming a substantial position in the UK online bingo market as Foxy Bingo has grown to be one of the biggest brands. The top bingo sites are currently squabbling over who has the biggest number of players, with variously Foxy Bingo, Gala Bingo and Tombola Bingo all claiming market leadership, depending on the criteria one chooses to measure size by.
There is speculation over who leaked the story to The Sunday Times with most parties involved in the deal pointing the finger of suspicion at one of the minority shareholders who is hoping the deal closes rapidly in order that they can pay off some substantial debts.
