Quebec province-based Amaya’s online poker brands returning to U.S. causing shares to surge

Quebec province-based Amaya’s online poker brands returning to U.S. causing shares to surge

MONTREAL — Shares in Montreal−based Amaya (TSX:AYA) were soaring Thursday on news that the world’s largest online poker business is once again being allowed to operate in the United States as a result of a deal with authorities in New Jersey.

“We are very pleased to add New Jersey to the long list of regulated markets that have found PokerStars and Full Tilt suitable to offer real−money online gaming,” said Amaya chairman and CEO David Baazov.

He said the approval, under an agreement with Resorts Casino Hotel in Atlantic City, was granted after a detailed review of the company’s business, including sworn interviews from more than 70 individuals and visits to several international jurisdictions.

On the Toronto Stock Exchange, Amaya shares were up nearly 16 per cent at $28.15 in afternoon trading.

New Jersey, Delaware and Nevada are the only U.S. states to permit online gaming. But other states, including Pennsylvania and California, have looked at joining the list, offering a huge potential opportunity for Amaya.

PokerStars stopped providing real money poker games in April 2011 after the U.S. Justice Department seized the domain names of the company and a couple of competitors.

Two applications to enter New Jersey were reportedly rejected because of legal issues facing the prior owners, who sold the business to Amaya in 2014 for $5 billion.

The state is the largest legal gaming market in the U.S. but generated relatively little in revenue from online poker last year. However, industry analysts say that while the financial returns from New Jersey are relatively small they could provide a springboard for the company as other states regulate online gaming.

Maher Yaghi of Desjardins Capital Markets said the credibility of the PokerStars and Full Tilt brand and Amaya’s corporate structure “should improve investor perception about the company and provide something of a precedent for other states to consider having PokerStars and Full Tilt throughout the U.S.”

Follow @RossMarowits on Twitter.

Ross Marowits, The Canadian Press

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