Bally Technologies acquires online gaming company Chiligaming
The transaction, however, does not mean Bally wants to launch it own Internet gaming website.
The company, which has an application pending with Nevada gaming regulators under the state's newly enacted Internet poker regulations, plans to use the technology with casino companies seeking both free play and wager-based gaming websites.
Bally agreed to acquire the technology from Chiligaming, which has offices in Malta, France and the United Kingdom. No purchase price was announced.
Chiligaming, which announced a deal Feb. 10 to launch a free-play gaming website later this year with Golden Nugget casinos, develops and operates multiplatform social games and gambling products.
Deutsche Bank gaming analyst Carlo Santarelli told investors the cost of the transaction for Bally Technologies is "likely to be modest."
Santarelli said Bally is expanding its interactive gaming division to participate in online gaming.
"The deal provides Bally with a key element towards advancing its mobile and online player tracking and bonusing initiatives while still ultimately benefiting its end user," Santarelli said.
With debate over the federal legalization of Internet poker seemingly stalled in Congress, many gaming companies are focusing on states that may enact online poker regulations that allow wagering in their jurisdiction. Nevada is the only state so far to adopt such regulations, and is accepting licensing applications.
"This acquisition (allows) Bally Technologies to offer an integrated traditional and online casino solution to operators worldwide," Bally Vice President of Business Development John Connelly said in a statement.
Last month, rival slot machine maker International Game Technology acquired social gaming giant Double Down Interactive, developer of Facebook's Double Down Casino. Shuffle Master Gaming has also launched an interactive gaming division.
Janney Montgomery Scott gaming analyst Brian McGill said in a research report that Bally benefits from continued momentum in its systems business and is less reliant on slot machine sales.
McGill told investors that many gaming industry veterans are downplaying the impact of Internet gaming, at least initially.
While online poker could launch in Nevada this year, McGill said revenue expectations are low.
"It will take passage from larger states, or a federal bill, to act as a catalyst to really drive revenues," McGill said. "At this point, neither of these seem imminent."
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