Britain's online gaming companies shares have surged after the announcement of the opening of the doors for the Boardwalk Empire state to become the first state in the USA to license online gambling.
The New Jersey governor Chris Christie has sprung a surprise with his announcement that he is prepared to sign the amendment bill that will allow online poker and casinos. It is expected that betting will probably start this year,
The UK online gambling companies have been waiting for a long time. hoping that things will loosen up in the USA laws, since the 2006 clampdown by the federal government forced them to shut-down.
There was wide expectation that Gov. Christie would reject the proposal, however, he surprised everyone when he said that he would allow the proposal in a revised form, on a ten year trial, should the tax rate on bets be increased.
New Jersey is the state where Atlantic City's hit series Boardwalk Empire is set. The resort was also overtaken by Pennsylvania over the past year and voted the number 2 US gambling center after Las Vegas.
The largest gains were from Bwin.Party shares showed a gain of 16% from 9p up to 135¾p. The company was a merger of Bwin and Party Gaming, and they already have a joint venture with Boyd Gaming, a USA hotel and casino operator who is licensed in New Jersey. Another British group Rival 888 whose shares rose from 19¼p to 135p also has partnerships in the USA one of which is Caesar's who owns casinos in the state of New Jersey as well as other states. Both of the businesses have agreed that they will provide operations online to the USA companies and receive royalty payments if the laws are relaxed.
Playtech the software developer shares rose from 42¼p to 532p, and William Hill the bookmaker shares were up by 4¾p to 399½p.
There is speculation that the New Jersey online casino could prove to be worth over $12 billion in a period of 5 years. The decision in New Jersey could pave the way for more states in the USA for allowing online gaming especially as tax revenues are much needed.
Brokers Numis, spokesperson Ivor Jones has said that the if the licensing is successful, gambling online is likely to have two positive effects:
- Encouraging other states to agree to licencing of online gaming
- And encourage federal legislators, including those who oppose it, to pass laws in order to attempt to control this development in the USA market.
The online operator 888 says that they are encouraged by the possibility of online gaming in the USA.