UK bookmaker stocks feel the pinch of US decision on online betting

THE bombshell the US Justice Department dropped on the surging online sports betting industry is being felt abroad, as UK bookmaker giants suffer a drop in share prices.

Last week the Justice Department’s new ‘opinion’ on the implementation of the Federal Wire Act placed the online bookmaker industry in jeopardy, given that it signalled that the prohibition on wagering crossing state lines should apply to all forms of gambling.

British betting companies like William Hill, Paddy power Betfair and 888 Holdings — all of which had make big inroads into the US market — immediately felt the pinch of the news.

The companies share prices fell between 1.5-7 per cent last week.

The Justice Department ruling does not technically overturn the 2018 SCOTUS ruling, which deemed PASPA invalid, opening the door for states to legalise sports betting, but it does open the door to months of legal challenges.

What is certain is WilliamHill, Paddy Power and a number of bookmakers who looked to the US as fertile land, will now have to cool their jets on the aggressive expansion we had seen over the last 12 months.

WilliamHill was the most prominent of the UK bookmakers to plant its flag in the USA, establishing prominent bookmaker partnerships in New Jersey, the first state to legalise sports betting following the ground-breaking Supreme Court decision.

Of course, in a Donald Trump-led America, developments on the issue remain unclear until the Government returns to full operation following its recent shutdown and the Government begins to prosecute its new interpretation of the law.

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