Inside Asian Gaming

100 INSIDE ASIAN GAMING | May 2013 INTERNATIONAL BRIEFS Online Poker Dealt in US—Legally The first legal real-money poker Web site in the United States is open for business. UltimatePoker.com, run by Ultimate Gaming, a majority- owned subsidiary of Las Vegas locals-market giant Station Casinos, began accepting wagers on 30th April, the first of several US Internet gambling operations on the way in the months ahead as the states of New Jersey and Delaware rush to join Nevada and get their online games up and running. Licensed in Nevada and limited by state law to residents and in-state visitors, UltimatePoker offers both single-table games and multi-table tournaments with buy-ins ranging from US$0.01 to $100. Players must be at least 21 years of age. About 20 other companies—including social gaming pioneer Zynga—are preparing to set up virtual shop in the Silver State, while on the other side of the continent Delaware expects to be online by September with full-scale casino gambling under the auspices of the state’s lottery and Atlantic City’s casinos are working with regulators to get their games online by the end of November. Like Nevada, however, both will be restricted initially to gamblers within their respective borders, although it is believed that states with legal markets will be able to compact with each other to increase the shared player pool. Several attempts to overcome the interstate divide by persuading the US Congress to sign off on national regulation have never gotten past discussion in committee and aren’t likely to in the future. Two years ago, a Justice Department crackdown on offshore operators practically drove the online game in the US into extinction. A fully realized US online poker market could generate US$4.3 billion in revenue its first year and $9.6 billion by year five, according to London-based research firm H2 Gambling Capital. But a state like Nevada, which has a total population of only 2.8 million, will be hard-pressed on its own to generate the liquidity necessary to make poker profitable. Las Vegas, however, welcomes more than 45 million visitors a year, and its all-powerful casino industry is hoping a revival of poker in cyberspace will help their bricks-and-mortar operations capture a younger market. UltimatePoker players, for example, can cash in winnings at any of Station’s 16 casinos, and tourists can create an account online before they arrive. Station also plans to offer guests rewards for playing Ultimate Poker, much like player points they receive in casinos. The points can be traded for free rooms or food. Gala Deal Elevates Rank to No. 1 in UK Rank Group’s clearance to buy UK rival Gala Coral will make it the country’s largest land-based operator. After months of investigation, the UK Competition Commission has finally given its approval to the US$274.2 million deal, which will enlarge Rank’s casino portfolio by 19 operating properties and three currently inactive licenses. The original agreement, concluded last May, would have seen Rank take over 23 Gala venues for total holdings equivalent to 44% of the national market, but that ran into trouble with the Office of Fair Trading, which referred it to the Competition Commission on fears that it would “substantially reduce competition in the casino sector”. The commissioners gave their OK on the condition that Gala’s Aberdeen, Stockton-On-Tees, Bristol and Cardiff casinos were excluded and that Rank shed an inactive license in Edinburgh in exchange for a Gala venue in the Scottish city. Rank sold the Edinburgh license to an entity called Global Gaming Ventures. In addition to its extensive online andmobile gambling products, the acquisition will have Rank ultimately owning 54 operating casinos and 12 non-operating licenses. Betfair Eyed for Takeover Online betting exchange giant Betfair is being targeted for takeover by private equity firm CVC Capital Partners. News reports say CVC has held preliminary discussions with investors Richard Koch, Antony Ball and other partners about Betfair, which could include an offer for the company by funds advised by CVC together with the two men and partners. Betfair’s market value is estimated currently at £800 million (US$1.2 billion). Mr Koch, a co-founder of international strategy consultancy LEK Consulting, holds a 6.5% stake in Betfair. Mr Ball is a non-executive director at Luxembourg-listed investment group Brait and is the co- founder of its private equity business. Since its acclaimed London listing three years ago, Betfair has lost ground to competitors at home and is pulling out of markets where gambling regulations are unclear, although these provide almost a quarter of its revenues. The company recently said it would pull out of Germany and Greece because of problems over licenses and punitive tax rates. The company’s shares have since fallen to well below the £13 the company listed at, and Chief Executive Breon Corcoran, who was hired last year from Irish bookmaker Paddy Power, has acknowledged the company had “lost its way somewhat.” CVC has been involved in gambling at various times in the past. The firm bought William Hill in 1999 and sold it three years later and once owned a stake in UK casino and bingo operator Gala Coral. Toronto Casino Limps Toward Uncertain Fate With four of his hand-picked executive committee members voting against him, Toronto Mayor Rob Ford has vowed to take