Shares in PartyGaming (PRTY.L), parent company of Party Poker, were up over 10% Friday amid rumors that it has come to an agreement with U.S. authorities over its prior U.S.-facing activities.
A settlement would virtually eliminate any chance of U.S. authorities taking any action against the company for prior activities in the United States since the passage of the Unlawful Internet Gambling Enforcement Act was passed in September 2006 and signed into law shortly thereafter. The UIGEA effectively outlawed the funding of online gambling accounts via U.S. banking institutions, with the notable exceptions of fantasy sports, online lotteries, and horse & harness racing. PartyGaming stock dropped almost 60% in 24 hours as a result of this bill being passed and subsequently was moved from the FTSE100 to the FTSE 250 several days later.
According to one UK trader, who requested anonymity: “I’m led to believe that they may have come to an agreement in the U.S. It means they would have no more outstanding issues with the authorities which would put them in the position where they could be bid for.”
PartyGaming had no comment, but it is doubtful that they would be conducting business once again in the United States any time soon.
888 (888.L), parent company of Pacific Poker, was also rumored to have held similar discussion with authorities in the U.S. It was also up slightly on Friday.