Sportingbet flogs US arm for $1
PrintBut keeps European and Australian businesses
Posted in Financial News, 13th October 2006 11:13 GMT
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Following "a comprehensive legal and strategic review" Sportingbet has ditched its US betting, casino, and poker business.
The business has been bought by Jazette Enterprises Limited for $1. Jazette also takes on debts of $13.2m.
Sportingbet reckoned the cost of shutting the business down would have been $14m in severance costs on top of the debts - a total of $27.2m.
The US business employed some 500 people.
Sportingbet keeps the web addresses and intellectual property relating to wallstreet.com, aces.com and sportingbetUSA.com, but will not use them for US gaming purposes. In exchange, Jazette will not take any non-US bets for two years. Sportingbet keeps the details of all non-US resident customers.
The deal is conditional on the Anti-Gaming Act being passed into law. The Act is still waiting for George Bush's signature, but he is expected to sign it today. If this doesn't happen, Jazette gets a $0.5m payment and Sportingbet keeps the business.
Sportingbet will also keep its Paradise Poker business, but stopped taking bets from US residents from 11am today. US customers can keep playing using their existing account balances for a month, but after that they will not be allowed to place real money bets.
The board said it "has taken immediate steps to prevent customers from 10 US States where there is law prohibiting internet gambling from playing real money poker at Paradise Poker".
So that leaves Sportingbet with its European sports, casino, and poker business and Australian sports business.
Sportingbet's full statement is available here. ®
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