Gibraltar News

Gaming Company Sells for €28 Million
Gaming is one of Gibraltar's biggest employers, making a huge contribution to the small British territory's economy and positioning it at the forefront of the e-gaming industry worldwide. Gibraltar has not only become home to many household names from the British gambling world, such as Ladbrokes and William Hill, but also to international gaming brands like PartyGaming, Mansion, and 888. The development of Gibraltar's telecommunications infrastructure, coupled with other factors such as its centralised European position, has made the tiny nation an ideal base for other, lesser-known gaming operations.

One such organisation is St Minver Ltd, a company that may not be as well-known as those previously mentioned, but is nevertheless one of the world's leading providers of so-called "white labeling" for the gaming industry. White labelling refers to the process in which a product or service is produced by one company but is marketed and rebranded by other companies to make it appear as if these other companies have produced it. St Minver produces many of the gaming options that appear on sites such as Yahoo, Virgin Games, and Littlewoods Online.

In April of this year, St Minver sold 90 percent of its equity to GTECH Corporation, a wholly owned subsidiary of Lottomatica, one of the world's largest commercial lottery operators and market leader in the Italian gaming industry. The price of the acquisition was €28 million, on a cash and debt free basis, with the potential to rise to €41.6 million based on the performance of the business during 2008 and 2009. The current owners will retain 10 percent of the business until 2012, when GTECH will have a right of first refusal on their remaining stake in the company.

St Minver was formed in Sept. 2003, following the purchase of Gala Interactive from the Gala Group, and originally existed as St Enodoc before changing its name in 2005. The driving force behind St Minver was Gary Shaw, a former employee of Victor Chandler International in Gibraltar. The company's strategy has always been to operate in markets where gaming is legal and regulated, a market that is growing steadily as more and more jurisdictions worldwide are beginning to approve and regulate interactive gaming channels.

The company has already seen massive growth during its short lifetime and currently provides end-to-end white label gaming services for 98 gaming sites and 76 media, lifestyle, and other branded partners. Within the industry, St Minver is known as a solid performer and had total annual revenues of €13.7 million in 2007. In addition, the firm operates one of the world's largest bingo networks, offering pooled bingo rooms by currency, with uniquely managed and optimized schedules. St Minver also provides support services for Boss Media's International Poker Network, which is the fifth largest in Europe and hosts more than 12,000 players at peak times. St Minver now employs 165 people worldwide, the majority of which are based in St Minver's Europort office in Gibraltar.

GTECH President and CEO Jaymin Patel cites St Minver's many blue-chip customers as one of the driving forces behind their acquisition of the Gibraltar-based company. He describes them as a "logical fit" for GTECH as they "continue to expand [their] presence in Internet-based gaming worldwide. Indeed, with increasing demand for Internet-based gaming services and technology in newly regulated markets in Europe, Asia, and Latin America." The acquisition will, in Patel's view, allow GTECH to provide a full service solution to new players in what is already a $15 billion a year industry.

Tristan Cano lives and writes about the gaming industry in Gibraltar.