Amaya Gaming Set for IPO on NASDAQ This Week, Duel Listing with TSX

Last updated on November 2nd, 2018

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Amaya Gaming is ready for its initial public offering on the NASDAQ this week. Despite the listing of its IPO, American gamblers still cannot make wagers through Amaya’s most popular brand: PokerStars.

Despite continued stonewalling by officials in New Jersey, Nevada, and Delaware, Amaya Gaming has an alluring package for investors. The Montreal-based online gaming software cmpany might not have been able to get PokerStars into the US market (yet), but that same brand dominates online poker elsewhere in the world.

Deal with GVC Holdings

Meanwhile, Amaya Gaming announced in May 2015 that it would partner with GVC Holdings on a deal to acquire bwin.party digital entertainment (uncapitalized on purpose).

The IPO is coming four months before the predicted listing. This is a dual listing, because Amaya Gaming is already listed on the Toronto Stock Exchange. The listing is needed, given the $4.9 billion purchase price of Rational Media, which owns PokerStars and FullTilt Poker.

Insider Trading Investigation

The announcement is also well-timed, because of continued news about an insider trading scandal involving the Rational Media purchase. Quebec authorities announced recently they plan to open an investigation into whether insider trading took place before the PokerStars purchase was announced.

Krejcik Sees Listing as a Positive Sign

Adam Krejcik, a gaming analyst for Eilers Research, says that the NASDAQ listing is a good sign for potential investors. Typically, such a listing would not happen, if serious regulatory troubles were thought to exist.

Krejcik said, “Amaya has always been confident that it would be cleared of any wrongdoing. Gaining a listing on a major exchange like the Nasdaq sends a message to investors. On a level, it signals that things are OK on the regulatory front.”

David Baazov: Visibility and Liquidity

In an interview last month with Globe and Mail, a top Canadian publication, Amaya’s CEO David Baazov said the NASDAQ listing “will provide greater visibility and better liquidity for our stock and help broaden our shareholder base.”

Gaining a foothold in the U.S. gaming market likely would help the stock soar. PokerStars has had a deal in place with Resorts Casino in Atlantic City since June 2013. PokerStars would provide the software support and playing community for Resorts Casino’s online brand. With such a corporate partner, Resorts Casino would have been an industry leader.

PokerStars in New Jersey

Then in October 2013, the New Jersey Division of Gaming Enforcement suspended the license application for PokerStars, citing concerns about that company’s (then) executives being indicted by the US Justice Department. Though the application was not rejected, it was placed in a regulatory limbo until further developments happened. One reason the Scheinberg’s agreed to sell PokerStars was the continuing legal trouble.

David Baazov pulled off an unlikely coup when he convinced the reclusive Scheinberg family to sell their multi-billion dollar business. Baazov approached the PokerStars clan at just the right time, as they were starting to face a stone wall in trying to get back into the U.S. gaming market. PokerStars continued to take US players after the UIGEA was passed in 2006. Furthermore, the world’s top poker site appears to have conspired with smaller US banks to mask signups for American gamblers.

Both actions led to the Black Friday indictments on April 15, 2011. Though PokerStars paid over $700 million to get out of legal jeopardy and retain its domain names, Isai Scheinburg never had his name cleared. That made it impossible for PokerStars to get back into the US market. In the end, PokerStars was worth more through sale than it was if the original owners continued to maintain it, because it would take new ownership to crack the lucrative American gaming market.

Enter: David Baazov

David Baazov was a dark horse to own Rational Group. Amaya Gaming had amassed some properties in the global gaming market. It had a good reputation and 60 licenses in the United States. But it was small time compared to PokerStars. When Baazov started to call the Scheinburgs, they hardly took him seriously.

But he had persistence and vision. Baazov also was Canadian-born, which is where PokerStars was founded. Thus, a little-known 34-year old executive became the owner of the world’s biggest online gambling franchise. Now he wants to build on that $4.9 billion success by adding bwin.party to the growing empire, while arranging an IPO on the NASDAQ. With all the acquisitions, David Baazov probably needs the additional liquidity. But when he puts the world’s biggest poker site together with one of the world’s largest online casinos, the results should be dominant.