EiG: Could M&As lead to shift in power balance?

EiG: Could M&As lead to shift in power balance?

Tuesday, October 20, 2015 Totally Gaming
Suppliers can secure greater influence over operators, EiG told

The current trend of mergers and acquisitions could lead to a shift of the balance of power in the gaming industry from operators to vendors, according to LexisNexis Director Yuri Cameron.

In an open floor debate entitled ‘Is industry consolidation good or bad for industry innovation and consumers’, Cameron said that there were now more obvious operator acquisition targets as opposed to the vendor sector.

“The industry is becoming more mature through the drive for efficiencies and competition is getting more intense,” Cameron said at EiG 2015 at Arena Berlin.

“There are fewer opportunities for acquisition-fuelled growth on the vendor side, although there are still good acquisition targets for operators.

“Traditionally, in the US at least, the operators have had a big say in how the suppliers are run. However, with the suppliers consolidating more quickly than operators, it could potentially shift the balance of power.”

The session’s moderator, Adam Rosenburg, the Global Head of Gaming and Leisure at Fortress Investments, raised the question of whether consolidation can lead to relationships with customers being damaged or diluted.

However, Cameron added that this can open up a positive opportunity for entrepreneurs to come in and make a difference.

Rosenburg, who touched on the emergence of grey markets and the controversy over the recent regulatory developments regarding daily fantasy sports in the US, added: “You have to be very careful as an investor. Market systematically underestimates regulatory risk.”

For the latest from EiG 2015, click here to check out our live blog.

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