Divorcing bwin.party founders to sell stakes in New Jersey license bid
LONDON (Reuters) - Two founders of bwin.party digital entertainment (BPTY.L), who are divorcing, have agreed to sell their stakes in the online gaming group if it is successful in winning a license in New Jersey, the third U.S. state to allow online gambling.
James Russell DeLeon and Ruth Parasol DeLeon will put their stakes of 7.16 percent each into a trust to be sold over the next three years under an agreement with New Jersey's Division of Gaming Enforcement (DGE), the company said on Thursday.
Under state legislation, substantial shareholders in gaming groups also have to submit individual license applications, something that the DeLeons did not want to do for reasons of privacy, bwin.party said.
Analysts at Numis said the agreement indicated that it was more likely that bwin.party would be eligible to start operations in New Jersey next month.
"It seems unlikely to us that it would have been executed so near to the start of online gambling in New Jersey if bwin.party were not likely to get permission to participate," they said.
Bwin.party applied in July for a license in New Jersey, the third state after Nevada and Delaware to legalize online gambling.
The industry sees New Jersey as the most lucrative casino market based on size and the fact its law encompasses many forms of gambling, while Nevada's regulations only allows online poker.
Borgata Hotel Casino & Spa, owned by Boyd Gaming Corp's (BYD.N) and MGM Resorts (MGM.N), said it received the first Internet gaming permit ever in New Jersey from the state's Division of Gaming Enforcement earlier this month.
Borgata is partnering bwin.party in its online gambling offering.
Shares in bwin.party traded up 2 percent at 124.8 pence by 0835 GMT.
(Reporting by Paul Sandle; Editing by Louise Ireland and Brenda Goh)