LONDON - Liberty Media Corp, the US group which has media mogul John Malone, announced on Tuesday that it has decided to acquire a majority stake in online game developer FUN Technologies Plc. The deal is expected to cost somewhere in the region of $195 million.
Liberty's purchase signals its intentions to have a say in the fast-growing UK online gaming market that has big names like PartyGaming and Empire Online hogging the limelight. Just last week, talks of a merger between the two giants broke down, but both have reported healthy revenues in the last quarter and have maintained an upbeat outlook. Fun Technologies, which is listed in both Toronto as well as on the Alternative Investment Market in London, is at the forefront of "skill gaming."
Fun co-founder and chief executive Lorne Abony was elated at having secured such a lucrative deal and said that it was a landmark achievement for the shareholders in the company, “Liberty is the right strategic partner to enable Fun's businesses to realize their full potential, through access to Liberty's world-class media and entertainment properties and affiliates. The transaction will also significantly strengthen Fun's balance sheet through Liberty's 50 million USD investment," he said.
Analysts say that the deal is a great one for FUN and leaves it with excess cash. Robert Winslow, an analyst with Wellington West Capital Markets Inc speculated that FUN could use the amount garnered from the deal to acquire rivals WorldWinner or GameAccount, both of which are into skill gaming in a big way.
As a part of the Liberty deal, Fun Technologies will become a wholly owned subsidiary of a new company, of which Liberty will own a majority stake. Fun Technologies' games are played online on sites like AOL, Disney, Virgin Games, MSN, eBay, and NASCAR.com.
Liberty chairman and CEO John Malone was happy at acquiring FUN, "We believe we can help Fun strengthen its industry leadership through collaboration with many of our programming and distribution affiliates," he said.
