Paddy Power’s entry into lucrative US market moves a step closer

BOOKMAKER Paddy Power could be in a position to enter the potentially lucrative US market sooner than expected, with hopes rising that proposals for the legalisation of online gambling could be passed by the US government within the next 12 months.

The Massachusetts-based Democratic congressman, Barney Frank, has been an advocate of legalising online gaming websites and has been pushing for legislation since the US government passed the Unlawful Internet Gambling Enforcement Act in 2006.

The act stops companies based online from accepting payments via credit card or other electronic means to settle online bets.

Mr Frank even put in an appearance at last week’s World Series of Poker event in Las Vegas to drum up support for his drive.

He said he was confident of getting a bill passed by sometime next year.

At Paddy Power’s annual general meeting, earlier this summer, the company announced the latest leg of its international expansion by entering the Australian market, via the €27.2 million purchase of a 51% stake in leading Australian online betting company, Sportsbet – with the option to buy it outright in the next couple of years.

Then, Patrick Kennedy – Paddy Power’s chief executive – remarked that the company would be very interested in entering the online gaming market in the US, if the laws there were changed.

Paddy Power opened a book on the issue of legalisation in the US, at the beginning of this year after receiving requests from certain punters to do so. A spokesperson for the company said yesterday that while stakes punted began at an average of €10-€20; last week they suddenly shot up in value to around €500.

The company began offering odds of 6/4 in favour of Mr Frank being successful in lifting the ban before 2011, but has since cut them to 4/5, as a result of the sudden upsurge in interest.

Power’s has also opened a book on which US state will be the first to drop the ban, should legislation be passed. Currently, the company has Utah as the 2/1 favourite, followed by Nevada, New Jersey, Texas, Louisiana and Tennessee.

California is priced at 20/1 with Florida at 25/1 and New York and Massachussets both at 33/1.