World's biggest online betting provider eyes stake in DFNN unit

MANILA, Philippines - The world’s biggest online sports betting provider is planning to acquire a 40- percent stake in the subsidiary of a local business process outsourcing (BPO) company.

Betfair, considered the largest Internet betting community worldwide with more than three million registered customers, has been given until Aug. 19 next year the option to acquire a 40-percent interest in Inter-Active Entertainment Solutions Technologies Inc. (IEST), an investee company of Pacific Gaming Investments Pty Ltd. which, in turn, is a subsidiary of publicly-listed DFNN Inc.

The 40-percent stake is valued at $15 million and the option may be exercised at any time before expiry.

DFNN told the Philippine Stock Exchange that its management is studying its current investment structure into IEST to possibly increase its holdings in the company.

London-based online gaming company Betfair processes, on average, more than five million transactions per day on its betting exchange. IEST, meanwhile, operates an online gaming operation under authority of the Philippine Amusement and Gaming Corp. (Pagcor).

DFNN services are divided into systems integration, programming and customization, consultancy, and gaming development.

With the advent of the opening of the regulated gaming industry, both land-based and electronic in Asia, DFNN has created a division to cater to the needs of the emerging Asian gaming industry. The company is currently delivering innovative new game content through a wide array of products, systems and solutions.

DFNN’s subsidiaries are Pacific Gaming, Hatchasia Inc. and Intelligent Wave Philippines Inc. Incorporated in Singapore, Pacific Gaming is engaged in the development and marketing of application software and the provision of internet-based, value-added services and other related consultancy.

On a consolidated basis, DFNN posted net loss of P12.9 million in the first six months of 2010, a P2.1-million decrease from the same period last year. Revenues dropped from P67.3 million to P49 million.

For the second quarter of 2010, DFFN generated revenues of P21.4 million, a 47.4 percent decrease from the P40.7 million earned in the same period last year. Net loss was at 8.4 million as against PP13.6 million last year.

Company officials explained that the decline in revenues are due to timing differences in project implementation in subsidiary iWave Philippines and Asia Pacific.