Gaming companies' shares surge on New Jersey license hopes
By Keith Weir and Siddharth Cavale
(Reuters) - The prospect of online gambling being legalized in New Jersey sent shares of gaming companies on both sides of the Atlantic surging on hopes it could unlock a market worth up to $1 billion.
New Jersey Governor Chris Christie vetoed an internet gaming bill on Thursday but called on the legislature to make amendments which, if incorporated, would be signed into law.
That would allow casinos in Atlantic City to offer online gaming to the nine million residents of New Jersey and also create opportunities for European companies with expertise in running online gaming operations.
It also fuelled hopes that other American states could follow suit and liberalize their gambling laws, though Christie proposed that the New Jersey law, if passed, should be reviewed after 10 years to gauge its impact on problem gambling.
U.S. casino operator Caesars Entertainment Corp's shares rose for the second straight day to trade up 27 percent at $12.75 on the Nasdaq while Boyd Gaming rose 8 percent to $7.64 on the New York Stock Exchange.
Caesars runs four casinos -- Bally's Atlantic City, Caesars Atlantic City, Harrah's Resort Atlantic City and Showboat Atlantic City -- while Boyd Gaming owns the Borgata Hotel and Casino resort in U.S.'s second biggest gaming destination.
"This would have the biggest impact on Boyd Gaming, who own the Borgata, and estimate it could be worth $3 to shares today. This bill would also be a positive for Bally Technologies Inc, International Game Technology, WMS Industries Inc and Shuffle Master Inc," Janney Capital Markets analyst Brian McGill wrote in a note.
Shares in the UK-based bwin.party, the world's largest listed online gaming group, soared more than 20 percent on the London Stock Exchange. Bwin.party has a joint venture with Boyd Gaming, which is licensed in New Jersey. Continued...