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Biggest online gaming company threatens to pull out of country



Printer Friendly VersionPost a CommentTell a Friend about this Article03 October 2006
As reported by: The Associated Press
Shares in British online gambling companies, including Sportingbet PLC and PartyGaming PLC, dived Monday after the U.S. Congress passed legislation prohibiting the use of credit cards, checks and electronic fund transfers for online gaming.

PartyGaming, the world’s biggest online gambling company, said it would pull out of the United States if President Bush signs the legislation into law.

The company 888 Holdings PLC said it is suspending online betting operations in the United States as a result, and Sportingbet PLC said it called off takeover talks with World Gaming PLC.

The legislation was part of a port securities bill passed by the House and Senate on Saturday.

The companies hit hardest by the ruling are those that offer betting markets denominated in U.S. dollars, and usually operate from bases in the Caribbean or Central America. Most of the big British and Irish sites, by contrast, keep their operations in Europe and take deposits only off credit cards denominated in pounds and euros.

Investec Private Bank commented that it was difficult to assess the value of online betting companies with heavy exposure in the United States because the allocation of costs is unclear.

Sportingbet, which does more than 60 percent of its business in the United States, said the impact of the legislation was unclear. However, the company called off talks about a potential bid for World Gaming.

Shares in PartyGaming plunged 58 percent to end at 45 pence (84 U.S. cents), shares in 888 sank 26.1 percent to finish at 108.25 pence ($2.03), while Sportingbet shares dropped 64.5 percent to close at 66 pence ($1.24).

Article By: The Associated Press

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