Cryptologic Might be Bought Out by Amaya

It has been confirmed that Amaya Gaming Group, a development agency heavily involved in consulting governments about the casino industry, has offered to purchase the share capital of Cryptologic, a developer who provides software solutions for top online casinos.  The provisional offer shows Amaya’s intent only; an actual takeover is likely a good while away.  Amaya had already purchased a significant share of Cryptologic last April leading many industry experts to expect this current move on part of Amaya.  Amaya CEO David Baazov said that the Cryptologic stock was purchased in order to avail possible strategic interaction with the developer.  Cryptologic, who deals more with casino games than finance, is being represented in the negotiations by Deloitte Corporate Finance.

Cryptologic’s Board of Directors has apparently, in principle, agreed to the terms of a possible all-cash offer for all of Cryptologic’s share capital.  The offered price was $2.50 per share (USD) which reflects a 52% premium compared to the NASDAQ closing price of $1.64 (as of 14/12/11).  From this point forward, the next stage for the Amaya Group will be determine the feasibility and profitability of the takeover based on the aforementioned offering price (the confirmatory due diligence phase).

The final takeover is now dependent on three major factors.  The first factor is the completion of the confirmatory due diligence by Amaya which translates to a confirmation of their intent to purchase.  The second factor is a unanimous decision by Cryptologic’s Board of Directors which is essentially a confirmation from their side.  Lastly, Amaya has to provide the capital in order to execute the purchase.  Understandably, failure to produce the capitol will result in the burying of the deal.  Amaya has until 1/12/12 to announce their purchase intent or bury the deal.