Online and land gambling group "finds itself constrained by a lack of working capital."
Shock news on Friday is that Leisure and Gaming plc has requested that trading in its shares be suspended, citing a lack of working capital, although the company is in early discussions with unidentified parties with a view to obtaining further funding.
According to Reuters reports, the management may be considering the disposal of certain elements of the company’s assets, although the market was assured that there was no expectation that any offers would be made for the group. In the meantime, all the group businesses continue to carry on business as usual.
Reuters and stock exchange reports comment that the company, which has a strong Italian presence, appears to be facing cash flow problems, hence the possible tactic of selling off part of its businesses.
Management have reported that its problems stem from poor sports betting margins arising from the repeated success of dominant football teams across Europe since the start of the year, points which it raised in its most recent financial reportage (see previous InfoPowa bulletins).
Group directors report that they are in “early stage discussions” with as yet unidentified parties in the hope of negotiating further funding. In tandem with this, a strategic review is in progress to examine the viability of selling "certain businesses and assets in its portfolio.”
Leisure & Gaming plc is a London based holding company providing comprehensive online and land-based betting and gaming opportunities to customers in emerging, regulated European markets under the brand name “Betshop”.
Betshop is the group's principal operating subsidiary, with experience in Italy, where it has over 700 betting shops, and Mediterranean markets. The company is also active in the UK, Cyprus and Greece.
In October 2006, after passage of the UIGEA, the company sold its US-facing business including vip.com and nine.com to a private group for $1, (see previous InfoPowa reports) and no longer accepts wagers from US residents.
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