Shareholders of European Online Gambling Companies Make Out Big On “Black Monday”
It could have gone either way. Following the indictments of the three largest privately held online poker firms Friday afternoon, long after the London Stock Exchange had closed for the day, antsy shareholders wondered which way the stock prices would go on Monday.
Having an entire weekend to absorb what had just transpired, it was clear: The markets were more than happy to get PokerStars and Full Tilt Poker out of the way.
Industry observers believe that the US Justice Department will be throwing all their resources towards prosecuting the indicted companies over the next 12 months.
In the meantime, Euro firms can focus on solidifying their relationships with Las Vegas behemoths while lobbying to have online gambling legalized in the States.
Bwin shares were up a whopping 34 percent Monday. 888 Holdings, which has formed an alliance with Caesar’s in Vegas, was up 24 percent. Playtech was up 11 percent.
European i-Gaming companies have long complained about an unfair advantage both Full Tilt and Stars had as they continued to accept players from the lucrative US market post-2006, following the passage of the Unlawful Internet Gaming Enforcement Act (UIGEA). Publicly held European betting firms were forced to abandon the market.
According to Execution Noble analyst Geetanjali Sharma: "The closure of the main competitors' operations and the US legal proceedings initiated against them should benefit European listed operators."
- Aaron Goldstein, Gambling911.com
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