Correction: Corrects the third paragraph to say CEO Mark Scheinberg's father Isai, not Mark Scheinberg, is under indictment for allegedly violating U.S. banking laws.
NEW YORK (TheStreet) -- Zynga (ZNGA) is facing a newly well-heeled rival across the online poker table. If it wants to win this game it had better start adding real money to the pot.
Fueled with equity and debt financing from Deutsche Bank (DB), Barclays Plc (BCS), Macquarie Group (MIC) and Blacksone Group (BX), Amaya Gaming Group (AMYGF) announced the acquisition of Oldford Group, the largest real money poker casino. Oldford Group owns Rational Group, the operator of PokerStars and Full Tilt Poker.
The deal values Oldford Group at $4.9 billion, with founder and CEO Mark Scheinberg leaving Oldford Group. Isai Scheinberg, Mark Scheinberg's father, is under U.S. federal indictment for allegedly violating banking laws designed to prohibit online poker sites. Isai Scheinberg denies any wrongdoing and is hopeful for a future settlement. Rational Group's other executives will remain.
The purchase also provides a new and updated metric to value Zynga. According to pokerscount.com, Zynga is the number one play money poker site. PokerStars is number two with about half, and Full Tilt arrives as the fourth largest free money site with one third as many players.
Zynga also offers real money poker but hasn't expanded beyond the U.K. market where it's licensed. Zynga's latest real money poker expansion was to offer a portal through long-term partner Facebook (FB). Last week, Zynga launched play money Zynga Poker Leagues.
Zynga needs to expand its real money poker offering not only because it's leaving a tremendous amount of money on the table (no pun intended), but also, the company doesn't want to risk the window of opportunity closing.
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