BUSINESS

Bundesliga threatens fixture list fee; Betfair CEO David Yu on way out?

TAGs: Betfair, bwinparty, David Yu, fixture list, Germany, pwin

bundesliga-betfair-david-yuIt was another dim day for public gaming companies on the London Stock Exchange. Bwin.party Digital Entertainment (Pwin) closed at 127p, just 9p above its historic low. Pwin has now lost another 10% of its value in the past week of trading. Shareholders have already made public their exasperation with the lack of promised dividends, so Pwin execs are likely keeping a wary eye on torch and pitchfork sales to gauge an increasingly belligerent public mood.

The early April plan announced by Germany’s states to tax sports betting turnover at a rate of 16.66% marked the beginning of Pwin’s pwummet. (Before the merger with PartyGaming, bwin reaped more than a quarter of its net revenues from the unregulated, and therefore illegal, German market.) Desperate to counter the German states’ plan, Pwin has thrown its support behind the state of Schleswig-Hostein’s plan to tax operators 20% of gross profits.

In this, Pwin may have found an ‘enemy of my enemy’ in Germany’s football league, which is threatening to charge betting outfits for the use of their fixture lists (something the UK leagues have also tried to monetize). The Bundesliga bandits will, however, drop this intellectual property demand if the states agree to open up their sports betting market to more competition.

Elsewhere on the LSE, Betfair shares lost another 26.5p on Wednesday, closing at 774.5p, just 4.5p above its all-time low. Betfair started the week around 840p, and then Numis Securities’ Ivor Jones publicly mused about a possible merger between Betfair and Sportingbet, which he helpfully suggested could be called Fairly Sporting. Jones said the tie-up would benefit Betfair by providing it with a “first-class fixed-odds bookmaking product which it needs to round out its product depth and avoid a lengthy, expensive and risky process of building it internally.”

Following Jones’ matchmaking attempt, Betfair shares promptly lost 30p, while Sportingbet lost about 5% of its value. Nice one, Ivor. While Sportingbet’s shares have since regained their losses, Betfair hasn’t shown a similar capacity to rebound. What’s more, Betfair’s inability to regain the ground lost since its £13/share IPO has prompted widespread rumors that all is not well in Betfair’s corner offices. CalvinAyre.com keeps hearing rumors that CEO David Yu, a California native, may soon be publicly stating his desire to ‘spend more time with his family,’ if you catch our drift.

Comments

views and opinions expressed are those of the author and do not necessarily reflect those of CalvinAyre.com