Online bookie spat: Empire to sue PartyGaming

Empire Online, the internet gaming firm, is attempting to sue PartyGaming after takeover talks between the two broke down.

Discussions ended after Empire was offered 60p per share (the equivalent of £176m in total) by PartyGaming, one of the largest online gambling companies in the world. The offer was significantly less than the failed offer of £800m two months ago from Sportingbet, another online gaming firm.

Empire's website acts as a third-party "skin", directing people to other gambling websites such as PartyPoker (a PartyGaming brand) and taking commission.

Two months ago, PartyGaming changed its technology platform, which prevented Empire and third-party firms acting as a skin for its brands. The Financial Times reports that Empire has experienced a 30 per cent fall in shares since the move.

A statement from Empire said: "Having received legal advice, the directors intend to institute and vigorously pursue legal proceedings as soon as possible."

A response statement from PartyGaming said it was confident it could win the legal challenge: "Empire has also said that it intends to take legal action against PartyGaming following the move of PartyPoker.com to a new platform on 8 October 2005. To the extent that any action is forthcoming, PartyGaming is highly confident of a successful outcome."