More firms prepare to flee US ahead of online gaming ban
Britain’s Leisure & Gaming and payment processor FireOne joined the list of companies fleeing a US ban on online gaming on Tuesday, as signs emerged that Europe is to open up its gambling market.
By Agencies |
LONDON: Britain’s Leisure & Gaming and payment processor FireOne joined the list of companies fleeing a US ban on online gaming on Tuesday, as signs emerged that Europe is to open up its gambling market.
Leisure & Gaming said it would stop serving US gamblers if President George W Bush signed into law a ban that was unexpectedly passed by Congress at the start of this month. Leisure & Gaming is in talks to sell its operations in the US, it added.
Payment processor FireOne said it would stop serving US gamblers after the ban. It warned this would have a “significant impact” on its business, knocking 26% off its share price.
The statements followed more bad news from the online gaming sector on Monday, with World Gaming fighting for survival and sector-leader PartyGaming earmarked to exit the FTSE 100 index after losing 63% of its value last week.
World Gaming asked the London Stock Exchange to suspend its shares as it was unsure it could continue trading, while larger rival Empire Online said it was looking to invest its $250m cash pile outside the troubled sector.
ADVERTISEMENT
The sector lost $7bn in value last week after the US Congress approved a bill making it illegal for companies to accept bets over the Internet or for credit card companies to make payments to online gambling sites. PartyGaming and 888 were the first two big operators to signal a withdrawal. By contrast, the European Commission’s internal market chief, Charlie McCreevy, said on Tuesday that legal action would be launched against France, Italy and Austria this week for running gambling monopolies, and he said there were more to follow. “It will be Austria, Italy and France on Thursday, if everything goes according to plan,” Mr McCreevy told reporters. “I reckon overall there will be 15 or 16 member states,” he added.
France has been widely criticised by gambling firms for arresting the two heads of Austrian betting firm Bwin.com last month to investigate alleged violation of its gaming laws.
Bwin’s shares were up 2.7% at E15. Meanwhile, Sportingbet will probably not reduce its operations in the wake of a ban, its CEO said. Sportingbet has yet to clarify its future strategy in the wake of a ban.
ADVERTISEMENT
Chief executive Nigel Payne, who is in Antigua for talks with government officials, was quoted as saying: “I can’t promise ... but I can say that it is extremely unlikely that we would have to downsize our operations.”Download
The Economic Times Business News App for the Latest News in Business, Sensex, Stock Market Updates & More.
The Economic Times Business News App for the Latest News in Business, Sensex, Stock Market Updates & More.
Download
The Economic Times News App for Quarterly Results, Latest News in ITR, Business, Share Market, Live Sensex News & More.
The Economic Times News App for Quarterly Results, Latest News in ITR, Business, Share Market, Live Sensex News & More.
ADVERTISEMENT
