PartyGaming suspends dividend amid US storm
Tuesday, 3 October 2006UK online gambling company PartyGaming suspended its interim dividend to shareholders today in the wake of US moves to ban Internet betting which has sent its share price plummeting.
Shares in PartyGaming sank nearly 7% in mid-afternoon deals. The stock had plunged 58.66% in value yesterday.
London stocks of online betting sites, which derive most of their earnings in the US, went into meltdown yesterday after Congress rushed through the Unlawful Internet Gambling Enforcement Act on Saturday.
PartyGaming has said it would suspend indefinitely all bets with US residents once President George W Bush signs the Act into law in the coming days.
'Following the decision taken by the board to suspend all real money gaming business with US residents, the board has today decided to cancel the company's interim dividend that was due to be paid on 31 October 2006,' PartyGaming said in a statement.
PartyGaming had warned yesterday that its financial performance for 2006 and 2007 would fall significantly short of forecasts as a result of the looming suspension of US activities.
The law prohibits US banks and credit card companies from processing Internet bets. The surprise measure was tucked into a bill aimed at enhancing port security, which passed over the weekend.
