Companies considering selling U.S. parts of online gambling business

Sportingbet Plc. and Leisure & Gaming Plc. are considering selling the parts of their businesses aimed at U.S. customers after announcing they will stop serving customers in the country because of new online gambling legislation passed by the federal government last month. The Unlawful Internet Gambling Enforcement Act (UIGEA) prohibits U.S. financial institutions from processing payments to or from online gambling sites.

Sportingbet Plc., which owns Paradise Poker, issued a press release today saying it is considering a number of approaches they've received for the U.S. facing business.

"The board is of the opinion that any sale of the U.S. facing business must be completed prior to the act (UIGEA) coming into law," the press release said. "As such any offers received may or may not result in a sale of this business. Based on the approaches received to date, however, it is unlikely that any such sale will realize significant cash consideration."

Leisure & Gaming Plc. also said in a press release yesterday that it was considering several approaches they've received for their U.S. business. The company plans to focus on its United Kingdom and Italian businesses, and may choose to sell its U.S. business now that the company finds it inappropriate to serve U.S.-based customers.

The company is undertaking a strategic review to determine if they will suspend, close, or sell its U.S. operations, which include Nine.com and VIP Poker. A source told media that those businesses are likely to carry on under private ownership with minimal impact on the customers.

News Added: 11 October, 2006

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