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Beispiel Case - 4 - Entwicklung: Bild

4. THE DEVELOPMENT OF BWIN AS AN INVESTMENT OF GLOBAL EQUITY PARTNERS

4.1 DUE DILIGENCE PHASE FROM 1997 TO 1999

Globalwetten GmbH was founded in 1997 by Carsten Koerl.

Global Equity Partners itself was also only founded at the end of 1997. Michael Tojner and Carsten Koerl met by chance and discussed the business model of sports betting on the Internet rather casually.

However, under the prevailing conditions at the time, Global Equity Partners recognized the opportunity as early as 1998 and a decision was made together with Meinl Bank AG to finance the company and not to set up its own start-up in this area. This path was later carried out with the financial services company Montana Securities and the online pharmacy Mymed.cc as part of the stage1.cc incubator.

In the area of the betting business, however, the entrepreneur Carsten Koerl was convincing and a stake in the start-up company was decided.

The Bet & Win product was launched in March 1998. At the end of 1998, bwin generated gross betting sales of EUR 2.88 million with 3,372 customers and a gross profit of EUR 215,000.00 with various sports betting on the Internet in four languages.

In February 1999, Global Equity Partners acquired a stake in the 13-man company.

The co-entrepreneurs Manfred Bodner and Norbert Teufelberger, who later joined Global Equity Partners, brought the company onto the stock exchange and thus provided it with the necessary capital. This enabled the company to develop into Europe's largest online sports betting provider.

A majority stake, which was achieved through several financing rounds, was essential for Global Equity Partners. Furthermore, the realignment of the strategy, which was achieved through the participation and participation of Manfred Bodner and Norbert Teufelberger, was decisive. Global Equity Partners held over 50% of the company; for a short time, 75% of the company was under the management of Global Equity Partners.

4.2 MANAGEMENT PHASE FROM 1999 TO 2005

With the entry of Global Equity Partners, the company management team was expanded to include Manfred Bodner and Norbert Teufelberger. As an internationally experienced marketing expert, Manfred Bodner was responsible for the coordination and implementation of global marketing activities, while Norbert Teufelberger, who had many years of practical experience in the international casino and betting business, took over the finance department.

An integrated meaningful reporting system was set up, the hardware platform was stabilized, the website was redesigned and the reprogramming of a weaving engine began.

The company's strategic goal was to expand aggressively both geographically and organically. The growth course should be financed through an IPO.

In this way, the Beauty Contest with the banks Vontobel, Erste, and RZB was promoted parallel to the operational area. CEA Corporate Finance GmbH in Germany was won as a strategic partner and the supervisory board was appointed. All in all, a close operational cooperation - comparable to the incubator business models - was lived. At the end of 1999, bwin generated sales of EUR 5.3 million and gross profit of EUR 625,000.

IPO in 2000


Together with Erste Bank AG, the company went public on the Vienna Stock Exchange in March 2000. This was the most successful IPO in 2000. With an issue price of EUR 13.50, the price rose to over EUR 35 per share in the first few months. With the funds from this IPO and the sales associated with a rapidly growing customer base (+ 200% compared to 1999; EUR 17.3 million), bwin has succeeded in building a leading IT gaming technology and a tax-efficient corporate structure with which the target markets - Germany, Austria, Switzerland and Italy - could be worked on ideally.
In 2000 the level of awareness in Austria was increased to 30% and the first expansion abroad to Scandinavia began. A betting license was negotiated for entry into Italy.
At the end of 2000, bwin generated gross profit of EUR 2.2 million with 45 employees. Liquid funds amounted to EUR 45 million.

Expansion in 2001


bwin pushed the expansion in Italy, Sweden, and especially Germany. The planning and ultimately the establishment of the Gibraltar structure began with the takeover of Simon Bold (Gibraltar) Ltd. (later BAW International) implemented. This also led to the acquisition of additional casino and betting licenses, the integration of the local management team and an optimal tax structure for the entire group. In addition, IT competence was increased, additional bookmaker know-how was created, the range of bets expanded and additional sales media developed. The target gross profit margin of 8% –10% was always closely followed.
At the end of 2001 the company had around 89 employees, generated betting sales of EUR 62 million, gross profit of EUR 4.4 million and was preparing for the Olympic Games in Salt Lake City in February 2002 and the World Cup in Japan and Korea before.

Significant growth in 2002


In the 2002 financial year, the company quadrupled its sales. By participating in a German sports betting provider, it managed to enter the market in Germany, which was one of the largest markets in Europe and, due to its strict regulations (only five providers were allowed), opened up particularly great potential for bwin. In the fourth quarter of 2002 the company broke even.
Bwin continued to focus on a sustainable growth strategy. As part of this strategy, the leading position in the Central European market was to be further expanded and markets in Southeastern Europe were to be developed selectively. In addition, sales were concentrated on the Internet, as this channel promised the greatest growth rates. The product portfolio was expanded to include lottery-like products developed in-house and the language offering on the betting platforms was expanded to include other languages. At the end of 2002 there were over 400,000 registrations.

Acquisition of sports betting provider Simon Bold in 2003


In September 2003, bwin then took over 100% of the online sports betting provider Simon Bold, which is licensed in England. The strategy continued to be clearly geared towards growth. The sustainable increase in the company's value was based on the constant expansion of the market position in the core target markets while at the same time securing and continuously improving the scalable technology platform.
At the end of 2003 a turnover of EUR 400 million was achieved with a gross profit of EUR 24.8 million.

Focus on gaining market share in 2004


The dynamic development in the area of sales and customer growth could be maintained. At the end of 2004 the company generated EUR 855 million in sales, a gross profit of EUR 52 million with 156 employees. Due to the focus on gaining market share, no increases have been budgeted in the area of results.

4.3 DIVESTMENT IN 2005

At the end of 2003, the VC holding companies decided to sell the bwin shares. In March 2005, the VC funds finally withdrew from the company entirely. For the investment companies and their investors, the investment in bwin resulted in a return of over 400% –2,000% and thus the 4 or 20 times the invested capital can be generated depending on the time of entry and sale.

4.4 FURTHER DEVELOPMENTS OF THE BWIN BETWEEN 2005 AND 2012

Betandwin became bwin. With the acquisition of Ongame announced in December 2005 and completed at the beginning of March 2006 , bwin was one of the world's leading online gaming companies. The 2006 financial year was spectacular. In September 2006, the board was ruled in France for alleged violations of national gambling regulations temporarily taken into police custody. The regulatory development led to an adjustment of the strategic direction. The aggressive growth strategy was changed in favor of a profitable, more cash-flow-generating company development. bwin concentrated on the core products sports betting and poker in the established markets in Europe. Regional expansion was only driven less aggressively.

In December 2006, bwin had to accept by far the largest loss in history (EUR 500 million) from attempts to enter the US market, as the company value of Ongame in the US had to be written down.

2007 was therefore a year of strategic realignment. The withdrawal from the US market at the end of 2006 and the ongoing resistance of some EU member states to regulated competition prompted the company to concentrate its advertising activities on selected core markets. The gross gaming revenues increased to a total of EUR 353.5 million in the 2007 financial year, with EBITDA improving to EUR 61 million (excluding share-based payments in accordance with IFRS2 in the amount of EUR 19.4 million). These figures underline that both the business model and the core business of bwin had a solid basis. Despite sharply reduced marketing expenses, bwin continued to grow with a profitable corporate development at the same time. One of the cornerstones of the company's strategy was the in-house development of products, especially sports betting and poker. This means that bwin was ideally positioned for the group's further growth. In the sports betting area, the live betting segment was expanded.

2008 and 2009 were all about product and customer development in the already established European markets.

In 2010 the merger with the London company PartyGaming took place.

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Beispiel Case - 4 - Entwicklung: Text
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