Analysis: Who is 2UP Gaming?
eGaming Review looks at the company that has raised £215m to buy an Atlantic City casino
The US has produced some eye-catching deals in the past couple of months, however when a widely unknown operator attracts a £215m investment to buy its way into the imminently live New Jersey market, the level of intrigue is increased once more.
News broke last week that UK-based firm 2UP Gaming had received a letter of intent from an unnamed Asian investment group to finance the acquisition or development of an Atlantic City casino. The first question most were asking was just who is 2UP Gaming?
Speaking to the firm’s managing director Vincent Crandon (pictured) on Friday evening, it became clear that these guys mean business. Crandon is the MD of finance company MidOil USA, which has already pumped $75m into the company and is overseeing its North American operations.
According to Crandon 2UP Gaming was heavily involved in the lobbying process in New Jersey and is now carrying out due diligence on a number of Atlantic City casinos in search of a potential acquisition.
However if that process does not bear fruit the company is poised to build its own casino, having held discussions with local architects and the state’s casino regulator over plans for a new, 200-room property in Atlantic City. Under New Jersey’s egaming laws, only those with a bricks and mortar presence are able to obtain an online gambling operator’s licence.
Aggressive plans indeed, and ones which are at odds with even the biggest names in the industry including Betfair and 888 who have partnered with Atlantic City casinos rather than build or acquire.
Crandon says 2UP’s strategy is to do everything itself from the start. “We don’t want to partner [with a casino] and limit ourselves to what that partnership involves. We want total control,” he said.
“We don’t care about being first. If we’re able to acquire a casino by September 9 (the date 2UP’s £215m investment is due to be finalised) then that will give us enough time to launch at the same time as everyone else. If not, who cares, we’ll just build a casino with the bare minimum 200 rooms and a small gambling floor and then run the online offering in parallel once we’re ready.”
2UP Gaming, founded in 2011 with an operational office in Melbourne, Australia, is listed on the UK’s GXG Exchange, the European stock exchange for SMEs. Crandon said the operator attracts between 8-10,000 players at any given time.
The key for the company in the US will be its proprietary live dealer technology, according to Crandon. Last year it acquired Curacao-licensed Romanian operator DBG for EUR25m, which has a suite of live dealer games and whose Dollaro poker brand currently sits at number 12 in the Pokerscout chart with a 24-hour peak of almost 1,000 players.
Should 2UP be successful with its plans to gain a foothold in the market, it will launch live dealer versions of blackjack, poker, baccarat, roulette and two craps games, as well as slots and poker products.
“Our live dealer component is our big USP “ no one else is trying to do this in the US market yet,” Crandon said. “There’s lots of talk about customer trust and credibility but with our proprietary software and live dealer technology we are beyond reproach in terms of fairness. That means we’ll have an advantage over everyone else.”
Crandon wouldn’t give further details on the unnamed Asian group behind the significant funding. But he did hint at it being a casino company by explaining that the agreement would involve bringing new visitors to New Jersey’s gambling destination. “This wouldn’t be the same group of people already visiting AC, it would be a new group of patrons,” he said.
He also confirmed he was in talks with entities in other US jurisdictions in order to forge relationships ahead of forming interstate agreements.
The financial clout 2UP Gaming now holds would easily cover the acquisition of an Atlantic City casino, with the ailing Atlantic Club casino almost sold to PokerStars for around US$40m. It would then have enough capital behind it to make a decent stab at launching and marketing an online offering.
Yet there is still too much unknown about the company and its investment to know just what significance it will really have in the New Jersey and US markets.