Shares in gaming software group GAN plc (LON:GAN) soared on Monday after it launched internet sports betting in the US state of New Jersey, which will be delivered for Paddy Power Betfair’s (LON:PPB) subsidiary, FanDuel Group.
FanDuel Group, a subsidiary of Paddy Power Betfair plc, is Gan's first US client to operate Internet sports betting using the GAN Platform.
The move comes after the US Supreme Court in May reversed a nationwide ban on sports betting that had stood for 26 years. Several British gaming firms have expanded into the US following the ruling. Gambling firm 888 Holdings PLC (LON:888) on Monday said it has made its first foray into the US sports betting market by launching its 888sport brand in New Jersey.
“Paddy Power Betfair will be one of the first operators to launch sports betting and therefore should take a sizeable market share,” analysts at Liberum said in a note to clients.
“Assuming Paddy Power Betfair take half the market and Gan has a revenue share of some 3%, then we estimate GAN should run-rate at a minimum of annualised around $2mln of recognised revenue, at high margin.”
Liberum added that in Europe, operators such as GVC target migrating 30-50% of sportsbook players across to playing casino games, leading it to expect in that the medium-term sum-of-the-parts opportunity from Paddy Power Betfair could be far greater for GAN.
Shares in GAN were 10.6% up at 67.50p in mid-morning trade.