Jeremy

In online gaming news today, PartyGaming (PRTY.L) founder Anurag Dikshit will be in the United States on Tuesday hoping to close the books on the long standing negotiations with the United States Department of Justice regarding the legal status of PartyPoker.com's operations prior to the UIGEA.

According to a Financial Times article published today, Aburag Dikshit has offered to pay fines of $300 million and plead guilty to an internet gambling charge.  Dikshir is Partygamings largest shareholder owning an enormous 28% of the company.  Although he has not personally responded to the Financial Times story, according to the AP, Partygaming has responded by saying the fines Mr. Dikshit will pay are expected to be significantly less than what was reported by the Financial Times.

The market reacted positively to a potentiol resolution between the USDOJ and PartyGaming Plc. (PRTY.L) with shares of the company rallying past 7%.  Likewise, other publicly traded companies also involved in negotiations with the USDOJ (UK:888, UK:SBT) also saw a nice rally in their share prices.

Although Dikshit faces a potentiol jail sentence by even stepping onto U.S. soil, the risk vs. reward seems to make sense.  By voluntarily meeting with the USDOJ, one would have to think his chances of incarceration or even criminal charges is slim.  For a powerhouse publicly traded company like PartyGaming, meeting with the U.S. and getting a positive resolution to their legal standing makes sense.

Following PartyGaming's organization for several years, I tend think this a very smart move strategically as well.  In the coming years with a new U.S. administration, should Las Vegas casinos begin looking into online gaming operations, PartyGaming may very well be sitting in the drivers seat for mergers, acquisitions, or any type of partnership.

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