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Shares in Bwin.Party have jumped in recent days with news that the company has joined forces with leading casino brands MGM Resorts International and Boyd Gaming to offer online poker to US residents once legislation is passed in the States, a number of experts have advised not to get too excited, too soon.
Land based casino operators MGM Resorts International and Boyd Gaming this past week unveiled a plan to partner with online gambling company Bwin.Party Digital Entertainment, subject to the legalization of Internet gambling in the United States.
Gibraltar-based Bwin.Party, the world's largest publicly traded online gaming company, was formed earlier this year through the merger of Austria's Bwin and PartyGaming.
Bwin.Party would own 65 percent of a start-up company that would offer online poker to U.S.-based players, while MGM would own 25 percent and Boyd would have a 10 percent stake.
U.S. prosecutors earlier this year accused the owners of three of the largest Internet poker companies of tricking regulators and banks into processing billions of dollars in illegal gambling proceeds.
That crackdown derailed a similar deal between online gambling operator PokerStars and Las Vegas-based Wynn Resorts Ltd. Steve Wynn is understood to have gotten out of that deal in approximately one week.
MGM closed its original Internet gambling operations in mid-2003, citing regulatory uncertainties.
"There is now an overarching opinion in Washington that this needs to be addressed," MGM Chief Executive Officer Jim Murren told Reuters in a telephone interview. "U.S. citizens are putting their financial assets at risk on sites that the U.S. government has no comfort over how they are being operated."
Wynn, MGM and other land based casino operators have been lobbying hard in recent years for U.S. legalization of online poker...which they say is primarily a game of skill, rather than other forms of gambling where the customer is playing against the "house."
Their goal is legislation at the federal level, but legalization efforts are also underway in several states.
"Federal legislation is a vastly better solution ... to avoid any ambiguities in laws," Murren said.
Casino companies argue that millions of Americans are already playing online poker on websites operated from overseas and legalization would bring that revenue to the United States, where it could be taxed, jobs would be created and integrity could be assured.
Opponents, including groups like the Southern Baptist Convention, say online gambling is an irresponsible way to raise revenue.
Boyd Gaming and MGM Resorts also said each has agreements to use Bwin.Party's technology under its own brands.
MGM owns 10 casinos on the Las Vegas Strip, ranging from Circus Circus to the Bellagio, as well as casino-resorts in Mississippi and Michigan and joint ventures in New Jersey and Macau, the only place in China where gambling is legal.
Macau is currently seen as a more go ahead region for the gambling business than Las Vegas.
Boyd Gaming, which runs Las Vegas properties that cater mainly to local residents rather than tourists, owns and operates 16 casino properties in six states.
Bwin.Party Digital Entertainment is looking to expand in a number of countries. The United States is their key target, however they also have Australia and New Zealand squarely in their sights.
Bwin.Party Digital Entertainment is known around the globe for brands such as PartyCasino.com PartyPoker.com and World Poker Tour.
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