Sportingbet's Rollercoaster Ride

Termed "the most powerful firm in global egaming" by eGaming Review Magazine, Sportingbet has exhibited mixed results on the stock market wheel of fortune. Rising to the giddy heights of 400p from an initial launch at a quarter of that value, the share plummeted to trade around 30p in September 2008. Banking crises and credit crunch concerns aside, this is a poor performance for a company with such a high profile.

Sportingbet's woes really began after the passing of the UIGEA under the US Safe Port Act. The new law essentially banned the transfer of any funds from US financial institutions to Internet gambling sites, with a few exceptions such as horse racing and fantasy gaming sites. This caused the stock price of Sportingbet and a number of other similar companies to collapse.

Sportingbet's share price drop should be viewed in light of the fact that the company made 14 million GBP with a staff of 200 in 2003, while in 2008 its revenue was over 100 million GBP with a staff of 1,000. Sometimes, the stock market really does have a mind detached from financial reality. Sportingbet also runs other online gambling businesses including bingo, casino games, and a string of sport book brands.

Following the passing of the Safe Port Act, Sportingbet canceled all business dealing with American players. This resulted in the closure of Sportingbet's major poker platform, Paradise Poker, leaving Sportingbet Poker run on the Boss software network as its only poker platform.