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Poker News | Gambling and the Law

Consolidation in the wake of the UIGEA?

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Reports continue to fly around the internet about who's marrying who. No, I'm not talking about Britney and K-Fed, I'm talking about the flurry of merger talks and business plan updates in the online poker world since the passage of the Unlawful Internet Gambling Enforcement Act.

Deals and news change almost faster than one can keep up with it. In the wake of closings, US pullouts, dramatic devaluation of stock and the sell off of several sites' US activities to third parties, the rumor mill has had plenty of grist for the past month. Rumors have been swirling about that Ultimate Bet and Absolute Poker would merge for weeks, finally culminating in several reports on reputable online sites that the merger would be announced earlier this month. So far, these rumors remain just that, rumors, as neither site has issued any press release confirming a merger.

If it were to take place, the new AbsoluteBet, or whatever the site would be called, would immediately become a leader in the internet poker realm. Absolute Poker sponsors white-hot tournament pro Michael "The Grinder" Mizrachi, while Team UltimateBet includes 10-time WSOP bracelet winner Phil Hellmuth, Jr., as well as Antonio Esfandiari and Annie Duke.

Rumors have been hot about the future of 888 Holdings, PLC, the home of Pacific Poker , with PartyGaming alleged to be one suitor. Major UK bookmaker Ladbrokes PLC has confirmed their interest in merging with 888 Holdings, which would create a behemoth I in the UK online betting world. According to industry sources, Ladbrokes CEO Chris Bell made a trip to Israel last week to discuss a possible merger with 888 founders.

PartyGaming has reportedly shifted interest from 888 to bwin.com, an Austrian betting firm. This move follows announcements from Party that its online sports betting firm Gamebookers has done very well since the acquisition in August, leading Party officials to look at the acquisition of other firms. Bwin is another firm that ceased accepting wagers from US citizens after the passage of the UIGEA, and is now facing a ban in parts of Germany on commercial betting.

Bwin representatives deny any negotiations with Party about a possible sale. "We are talking to PartyGaming, like with all other big firms, about lobbying together to show a united stance for the industry in the European Union," said Karin Klein, spokeswoman for Bwin. "But we are not talking to PartyGaming about a sale."

There will undoubtedly be more shakeups coming in the world of online poker as the enforcement provisions of the UIGEA are determined later this year and early in the spring. Some smaller companies are quite likely to be gobbled up, while some, like PamelaPoker , will fade into obscurity before they are even given the opportunity to become fully realized. After the dust settles, we may very well see a field with ten giants working together for regulation and codification, rather than 100 small companies scratching out every dollar they can in a legal grey area. And would that end result be so bad?

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