Party Gaming, the internet poker business, has moved closer to a £5bn float on the London stock market by appointing two City big hitters to its board.
Michael Jackson, the chairman of the software group Sage, and Brian Larcombe, the former chief executive of the 3i Group, joined the company yesterday as non-executives, indicating that the company is gearing up for one of the biggest listings in recent years. Estimates suggest that Party Gaming would have a market capitalisation of about £5bn.
Mr Jackson will become chairman of the board, while Mr Larcombe will take on the role of deputy chairman. But despite the appointments, Party Gaming insisted that it was still considering its options. The company also revealed that its revenues had quadrupled during 2004 to $602m (£323), giving it earnings before interest, tax and amortisation of $391m.
The float will make billionaires of the founding shareholders. Anurag Dikshit, a graduate of the Indian Institute of Technology, designed the original software and owns 41 per cent of the business. Ruth Parasol, a lawyer, owns 25 per cent, as does her husband, Russ de Leon. Vikrant Bhargava, another Indian Institute of Technology graduate, owns 15 per cent.
The news will reassure the market that the flotation is on track after Party Gaming announced that it had parted company with Investec, which had been instructed earlier in the year alongside Dresdner Kleinwort Wasserstein to carry out a strategic review. Richard Segal, the chief executive of Party Gaming, said: "We have nothing but the highest praise for Investec. We have decided to go forward with Dresdner because it has the global reach we wanted."
The float is a testament to the growth of the online poker industry. Sportingbet bought Paradise Poker last year and has seen its shares treble in value. Cassava Enterprises, owner of the 888.com brand, also plans to float this year.
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