Bet your bottom dollar: UK bookies are up after a US court ruling slapped down PASPA

 
Alys Key
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The ruling opens up opportunities for legal betting on events such as the Super Bowl (Source: Getty)

Shares in the UK's gambling firms are soaring after a US court ruling struck down a decades-long restriction on sports betting.

The US Supreme Court today ruled in favour of the state of New Jersey, effectively killing the Professional and Amateur Sports Protection Act (PASPA).

US states can now establish their own regulated sports betting, with 20 already taking action to legalise the practice and start collecting tax income.

Shares in bookies GVC, William Hill and Paddy Power jumped following the news.

Neil Wilson of Markets.com said the change represented a "huge opportunity" for bookies, especially William Hill.

"Hills can roll out gambling operations pretty swiftly from Nevada, where it already operates and has very strong market presence," he said. "And it's already got a New Jersey op that is primed and ready to start taking bets within days."

William Hill shares closed up more than 10 per cent at 313.1p, and chief executive Philip Bowcock released a statement saying that "all attention" would now shift stateside, where "steps have already been taken to prepare for this day".

Meanwhile Paddy Power was the biggest riser, closing up 12.2 per cent, and GVC was up 7.4 per cent.

Analysts at Shore Capital said the initial reaction was "exuberant", but that GVC was primed to benefit due to "its wide international spread, momentum and significant synergy opportunities post the acquisition of Ladbrokes Coral".

Prior to the ruling, billions of dollars were bet illegally in the US on major events, especially the Super Bowl.

Today's decision provides welcome relief for top sports betting firms which can now expand in the US at a time when regulatory pressures are making trading in other markets more difficult.

It emerged today that William Hill has warned it will be left vulnerable to a foreign takeover bid if a proposed cut of the maximum stake for fixed-odds betting terminals (FOBTs) to £2 is approved.

Sky News reported that the bookie has launched a last-ditch appeal to culture secretary Matt Hancock ahead of a decision on the policy this week.

The announcement of the plans earlier this year weighed on bookies' shares.

Australian authorities have also cracked down on gambling, with a credit betting ban which prompted William Hill to sell off its Australian business.

Bookies were not the only ones to benefit from today's ruling. Shares in software company GAN closed up nearly eight per cent, as the company provides technology for Paddy Power in New Jersey.

"This decision by the Supreme Court more than doubles the total addressable market for GAN and our US clients, for whom we have prepared diligently for today's Supreme Court decision by integrating sports betting into GAN's Platform," said chief executive Dermot Smurfit.

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