London (Reuters) – Online gaming group Sportingbet said on Wednesday that talks over a possible takeover by Austrian Internet bookmaker bwin had ended by mutual consent, sending its shares down over 9 percent.
A source close to the situation said regulatory uncertainty over the online gaming markets in which the two companies operate was one of the main reasons why they couldn’t agree on the terms of a tie-up.
The ending of the talks is the latest blow to bookmakers and online gaming firms seeking consolidation to boost growth in the wake of an effective ban on Internet gambling in the U.S. market last year.
In April bookmaker Ladbrokes dropped takeover talks with 888, partly due to the threat of possible retrospective prosecution by U.S. authorities.
Besides problems in the United States, gaming firms are also facing regulatory uncertainties in Europe.
In April bwin reported a sharp drop in quarterly new customer numbers, hit by legal uncertainties around global gambling, and warned that these would persist for years.
In Germany, for example, state-owned lotteries have lobbied for a draft law to ban Internet betting and lotteries and have sought to convince authorities to ban bwin from accepting bets. Several court cases are pending.
Sportingbet, which disposed of its U.S. business in October last year, declined to comment on whether it would seek a deal with other gaming firms. Bwin also declined to comment.
„On March 7 the board of Sportingbet announced it was in discussions with bwin Interactive Entertainment AG regarding a possible acquisition of Sportingbet. These discussions have now been mutually and amicably discontinued,“ the British group said in a statement.
Shares in Sportingbet were down 8.9 percent at 53.5 pence by 12:20 a.m.. Bwin was up 4.2 percent at 25.12 euros.