888 Holdings PLC TO Continue With Flotation Plan
The flotation of online casino 888 should still go ahead but the price of the listing may be weaker after Internet poker group PartyGaming warned of slowing growth on Tuesday.
888 spokesman Nick Lambert said: 'The float is still totally on track... The investor education process has been getting very positive feedback.”
But analysts warned 888's plans to sell shares will at the very least sorely test investors' appetite for internet gaming stocks as fears grow that the industry's near-exponential rate of expansion is cooling rapidly.
Shares of PartyGaming Plc, the online operator which competes with 888 in poker gaming, fell as much as 37 percent on Wednesday after the company said revenue growth is slowing, wiping about 2.4 billion pounds ($4.4 billion) from the company's market value. As of Monday, PartyGaming shares had risen 35 percent since its IPO in June, while the shares are now trading below the offering price.
PartyGaming's valuation is being used as a benchmark for 888's business, bankers said. Shareholders of 888, who plan to sell $500 million of stock in an IPO that would value the company at about $1.5 billion, may raise less now in the offering, bankers added.