Sunday, October 15, 2006

Britain's Sportingbet and Leisure & Gaming both pulled out of the United
States ahead of a ban on Internet gambling on Friday, each selling their
U.S. operations to private investors for $1. Smaller rival World Gaming
meanwhile said it was impossible to continue in business and called in
administrators. All three companies were rushing to complete the deals
before President George W. Bush signed a bill to prohibit Internet gambling
into law on Friday. Sector leader PartyGaming and 888 have already
announced their exits from the United States. "We are saddened to have to
dispose of such a fantastic business as a result of political actions in the
U.S. Congress," Sportingbet Chief Executive designate Andy McIver said on
Friday. Sportingbet said it received $1 for the U.S. operations and had
discharged liabilities of $13.2 million and avoided closure costs of $14
million. Leisure & Gaming Chief Executive Alistair Assheton led a management
buyout of his group's U.S. operations for $1, rather than close them down
and fire 300 staff. The exit from the United States comes after Republican
legislators delivered a heavy blow to Internet gambling this month when
Congress unexpectedly approved a bill to enforce prohibition of online
gaming. Sportingbet's volatile shares rose by 5 percent in early trading
before falling 12 percent to 57 pence by 1406 GMT, valuing the group at
almost 240 million pounds ($447 million) -- less than a sixth of its value
of 1.6 billion pounds in July before the start of the U.S. clampdown on
Internet gaming.