Bwin.Party Digital Entertainment PLC and Playtech Ltd. shares rose sharply Monday morning with expectations the latest crackdown on Internet gambling by U.S. authorities will benefit European online-gaming groups.
European online-gaming companies that pulled out of the U.S. a few years ago because of the government's ban on online gaming have since been less competitive than those still accepting money from U.S. residents as their betting pool is smaller. But the U.S. crackdown on online poker could turn the tables in favor of the European operators.
"All in all, we think the newsflow is good to very good news for the operators of non-US facing poker operations, most notably the market leaders in B2B poker, Playtech and Bwin.Party," Evolutions Securities analyst James Hollins said.
Bwin.Party shares rose 31%, making it the top riser on a broadly flat FTSE 250 Index. Playtech shares increased by 12% while 888 Holdings PLC shares gained 15% in London.
Playtech was upbeat about the recent developments in the U.S. "Whilst none of our licensees accept online poker bets from the U.S., we expect to see a migration of international poker players to our leading iPoker network, which is the largest poker liquidity pool in the world," a Playtech spokesman said. Playtech will report first-quarter numbers on April 28.
888, which last week announced the termination of merger talks with Ladbrokes PLC and the departure of its Chief Executive Gigi Levy, has seen the number of first-time players to their site double over the weekend, a person familiar with the situation said Monday. Bwin.Party wasn't immediately available to comment on the likely benefits of the latest move in the U.S.
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