PARTYGAMING US SETTLEMENT IN SIGHT?

6 June 2008

London market reacts to Friday rumours


Party Gaming spokesmen have declined to comment, but as the week ended there was more than a frisson of excitement on the London market as rumours circulated that the online gambling group has reached a settlement in its negotiations on its pre-UIGEA situation with the US Department of Justice.

The continued attraction of online gaming stocks was illustrated by the positive reaction to the rumour, which saw leading industry companies benefiting from share price increases - Party shares climbing 16 percent, Sportingbet 20 percent and 888.com nearly 8 percent.

PartyGaming began negotiations with the Justice Department in June 2007 (see previous InfoPowa report) as industry concern spread over possible legal action against Internet companies that took bets from Americans before a 2006 law barred financial transactions with online gambling companies.

Any settlement by Gibraltar-based PartyGaming would be "material'' and would "give people a better idea what they were worth if they were open to acquisition,'' Mark Brumby, an analyst at Blue Oar Securities in London told Bloomberg business news.

"The rumour going around is that they've [Party Gaming] settled with the U.S. Department of Justice,'' CMC Markets trader Claire Collingwood informed Bloomberg.

As we went to press there had been no clarification from Party Gaming.

Online Casino News courtesy of InfoPowa