Betcorp sells Poker & Gaming for US$9m

In a statement to the London Stock Exchange, and on its website, BetCorp, parent company of online poker sites BetHoldem and 123Poker, said it had sold its BetWWTS Gaming operations based in Antigua and Toronto to Bodog Entertainment Group SA.

Betcorp sold their entire gaming operations for a cash consideration of US$9 Million (4.8m Pounds): US$3 Million on completion and a further four equal quarterly installments during the following 12 months for the remaining US$6 Million.

In addition, Bodog will meet the current liabilities of US$2 Million. So in total, the deal represents an enterprise value on the operations of US$11 Million.

Betcorp said that if the operation has been closed down it would have cost approximately US$6 Million in severance and closure payments.

They noted that the sale was caused by the October 13 signing of the Unlawful Internet Gambling Enforcement Act (UIEGA).

Despite progress in expanding markets outside the United States, "the US market still represented over 85% of the Group's revenues in the period from 3 July 2006 to 13 October 2006."

Near the end of their statement, Betcorp noted: "The Board received legal advice and representations from its lawyers, bankers and other advisors and concluded, in common with many other listed companies in the sector, that it is no longer possible for the Group to provide its services to United States residents."

"The two key issues which led to this conclusion are the possibility of the extra-jurisdictional application of United States legislation and the restrictions on financial transaction processing which are following from the Act."

"As a result, the Group suspended the accounts of United States residents on 13 October 2006."

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