Party Gaming axes interim dividend
PrintUS gambling ban reverberates through sector
Posted in Financial News, 3rd October 2006 17:35 GMT
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Party Gaming, the world's biggest online gambling business, is axing its interim dividend, worth $115m, previously due to be paid on 31 October.
It is making the move in response to the prohibition of online gambling in the US, where most of its customers live. The ban was smuggled unexpectedly through Congress late last week, with provisions making it illegal for American banks and credit card firms to process payments to gambling sites inserted the Safe Port Act. The ambush threw the big online gambling companies into disarray and sent their share prices plummeting. Most of the major players are listed on the London Stock Exchange, if domiciled abroad.
Party Gaming, headquartered in Gibraltar, has suspended all real money gambling with US residents. It says the cancellation of the interim dividend will enable it to "take advantage of the many attractive opportunities in the sector that will emerge over the coming months".
We take this to mean that it is looking to make distress purchases and to beef up its business in east Asia, a hotspot of gambling, of all kinds. ®
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