888 and bwin.party investors bet on New Jersey

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Online gambling companies bwin.party digital entertainment and 888 Holdings shares hit the jackpot on Friday after a key US lawmaker in New Jersey let his poker face slip and indicated the state would soon allow internet gaming.

Chris Christie, the Governor of New Jersey, raised hopes that the state, which has a population of 8.8m, could become one of the first to ease strict US gambling laws and open the door to online poker and some internet casino games.

Shares in bwin.party, the world’s largest listed online gaming business, jumped 16pc to 135.8p while 888 Holdings closed 17pc higher at 135p, as analysts estimated they would be the greatest beneficiaries of the proposed legislation, which could come into force as early as September. Sportech, which operates betting at race tracks in New Jersey, rose 5.6pc to 80p, amid expectations they might also be able to expand into online casino games.

Estimates on the potential size of the market vary but consultancy H2 Gambling Capital has forecast it could be worth $560m (£353m) a year.

New Jersey, home to the gambling mecca Atlantic City, is expected to issue licences to bricks-and-mortar casinos rather than online specialists. However, 888 supplies US casino giant Caesars Entertainment with online poker technology while bwin.party has a partnership with Boyd Gaming and MGM Resorts International.

Nevada has already agreed to allow online poker and analysts hope a move by New Jersey could lead to further states liberalising stringent internet gambling laws. Delaware has also taken steps towards lifting a ban on online gaming. “The symbolism [of the New Jersey move] is huge,” said Nick Batram, leisure analyst at Peel Hunt.

Governor Christie has opposed previous attempts at legalising online gaming but on Thursday indicated he would pass the latest bill presented to him, subject to a few changes, including a 5pc increase in the potential tax on winnings to 15pc.