The first cracks are starting to appear following last month’s completion of the merger that created the worlds largest publicly traded gambling company, bwin.party (Pwin).
They knew that a ruling in Germany was coming but even Pwin personnel have been caught off guard by the proposal of a 16.67% tax on sports betting by German states. It sent stocks in the group tumbling by 16% in London, significant, as it’s the most money that’s been wiped off a gaming company’s stock since the UIGEA.
This is why the head honchos at Pwin towers have come out with more comments on the German proposals stating the obvious point that their business will now likely be unviable in Germany.
Pwin co-chief executive Norbert Teufelberger said, “Implementation of the principles presented by the minister-presidents yesterday is just as likely to fail as the outgoing monopoly model in Germany.
“A proposed tax rate of 16.67 percent on the stakes placed in sports betting would make it impossible to offer a competitive product. Furthermore, excluding poker and casino products from this licensing model will continue to drive consumers into the black market.
“We trust that these proposals will undergo the necessary corrections so that the new regulations will govern the entire German market in a coherent and consistent manner in line with EU law.”
The merger faltering at such an early stage is no surprise owes a small thanks to the fact that they’re publicly traded. By merging, they simply removed one more obstacle for the private gaming companies that are set to dominate the global online gambling marketplace.