Britain's Sportingbet Plc has pulled out of the United States ahead of a ban on Internet gambling by selling its US operations to private investors for $1.
Sportingbet's US operation, Sportsbook.com, was sold to Jazette Enterprises Ltd and will now operate as a private company out of an existing office in Dublin, as well as offices in Antigua, Vancouver and Costa Rica.
Sources suggest that jobs at the Dublin office are safe.
"We are saddened to have to dispose of such a fantastic business as a result of political actions in the US Congress," Sportingbet Chief Executive designate Andy McIver said on Friday.
"Sportingbet received cash consideration of $1 for the shares and related assets of the US operations, and has discharged excess liabilities amounting to approximately $13.2 million (€10.5m)," it said in a statement.
The exit from the United States comes after Republican legislators delivered a heavy blow to Internet gambling this month when Congress unexpectedly approved a bill to enforce prohibition of online gaming.
President George W. Bush is expected to sign the measure into law later today.
Sportingbet's shares rose by 5 per cent to 68.5 pence by 10.47 am (Irish time), valuing the group at almost £290 million (€231m) - down considerably on the group's value of £1.6 billion (€2.4 bn) in July before the US started its clampdown on the industry.
"We think this is a good deal for Sportingbet shareholders, which removes a small level of uncertainty and should help conserve the group's net cash," analysts at Numis Securities said.
The analysts said they had stripped out £13.1 million (€19.4m) of anticipated profit from Sportingbet's US operations to give a new group pre-tax profit forecast of £20.8 million (€30m) in 2007.
The online gaming industry is now splitting between London-listed companies, which are pulling out of the United States, and privately owned businesses that are prepared to take illegal US bets offshore.
Sportingbet will retain its Paradise Poker business, but will stop accepting US money later today.
"Had the business been closed, the board estimated that the cost of severance and closure would have amounted to approximately $14 million (€20.1m) - a total saving of circa $27.2 million (€40.3m)," it added.