Shares in European gaming firms rise after the websites of some U.S. poker operators are shut down by the U.S. government after charges of illegal gambling, money laundering and fraud, potentially providing opportunities for European companies.
Bwin Party Digital BPTY.L rocket 35 percent, with Playtech (PTEC.L) and 888 (888.L) up 11 percent and 7 percent respectively, as analysts expect high-value players, affiliates and processors to seek safer sites.
“Bwin.party could generate incremental EBITDA of 76 million Euros, 41 percent accretion, and Playtech could generate additional EBITDA of 19 million Euros, 17 percent accretion, assuming their market share (excluding U.S. players) is maintained,” Liberum Capital analysts say.
Execution Noble analyst Geetanjali Sharma writes: “The U.S. facing operators have been a drain on the profitability of the European operators as their U.S. liquidity drew the non-U.S. poker players and at the same time these operators diverted cash gained from the U.S. operations to gain market share in the regulating territories in Europe.”
“The closure of the main competitors’ operations and the U.S. legal proceedings initiated against them should benefit European listed operators.”
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