BetWWTS Calls Sale a Reverse Takeover

29 January 2003

Despite what some officials involved with the sale of describe as "smear tactics" by the group's competitors, a reverse takeover is going according to plan for the gaming Web site.

Last week it was announced that the site, one of the first Internet-based sports books, was being sold to Consolidated Gaming Corp. Ltd. of Australia.

The announcement of the sale came just two days before news that Consolidated owed the Northern Territory Racing Commission AU $50,000 in tax money and a player AU $50,000 in winnings. Both complaints led the commission to suspend the company's betting license. The announcement of the pending purchase coupled with the suspension of the betting license caused many in the industry to speculate about the future of both Consolidated and

One week after papers were signed to finalize the sale, officials with are explaining exactly what happened.

Bill Scott, the owner of, founded the site in 1995 and was one of the pioneers in the offshore gaming industry. Scott has had health issues in the past couple of years, and an official with the company said he had been trying to find a suitable ownership group for the last year and a half to takeover his operation.

Simon Noble, the former head of and current CEO of, was brought in nearly three months ago to lead the transition from Scott's leadership to the new regime. He told Interactive Gaming News that media reports of a "sale" of were grossly exaggerated.

"This is a reverse takeover," he said. "We aren't going anywhere."

The final result of the reverse takeover will be being a publicly listed Internet sports book on the Australian Stock Exchange. Consolidated is currently traded on the exchange.

Grant Griffiths, who helped facilitate the takeover, said Consolidated would eventually be renamed by the board and shareholders to reflect the addition of Many key figures, such as Noble and a new CFO and U.K. bookmaker, were added to the management team of in the last three months to prepare for the reverse takeover.

Under that leadership, will become part of the new company and assume a place on the ASX, a valuable asset to any business, according to Noble.

As for the trouble with Consolidated, Noble said it has all been cleared up. However, he said the timing of the developments wasn't ideal.

"We were surprised and embarrassed," he said. "Here we were two days before we were supposed to close on the deal and it is coming out that they owe their regulators and some of their players."

Although the news was shocking to, Noble said it was kind of emblematic of the way the business had been run in the past.

"Companies that have really tight boards and are run perfectly usually aren't the target of reverse takeovers," he said. "They were basically a shoddily run sports book in the NT."

Noble said it was more surprising to him that the site owed about AU $100,000 when millions of dollars in capital had been raised in conjunction with the takeover.

Griffiths and Noble both said all of Consolidated's debts, including the back turnover taxes and AU $50,000 disputed payout, were paid within 48 hours of the deal being finalized with

"There isn't one outstanding complaint," said Griffiths.

Officials with the NT Gaming Commission failed to return calls to IGN to confirm or deny the report.

Griffiths also said any customer of Consolidated who requested a cash payout of his or her account received funds within two days of the request. He said more than AU $400,000 was paid out to users of the site.

Eventually will be dual licensed, with operations in Antigua and NT.

Antigua's Director of Offshore Gaming, Ronald Maginley, said his office would have to formally sign-off on any change of ownership for Part of that procedure would include a due diligence check of the new owners' business proceedings in Australia.

"If they hadn't paid their players that could be a problem," he said. Noble said he and the staff at have a good relationship with Maginley and that he doesn't anticipate any problems with the transition.

Having one of only four Internet bookmaking licenses in the NT will give the new a strong foothold in the Asian market.

With the license currently suspended, though, Noble is uncertain when the site will be up and running. The current Consolidated SportsBet site has a message to visitors briefly informing them of the sale.

"We have recently merged with another company and expect to recommence trading on the 4th of February," the statement reads.

The board of Consolidated and officials with are scheduled to meet with the NT Gaming Commission on Feb. 3 to discuss the suspension of the license, Griffiths said. Noble was hopeful that an issue can be resolved but said it might be later than Feb. 4 before the suspension is lifted.

"The important thing to note here is that it has been suspended and not revoked," he said. "Hopefully we can go to the regulators and show them that we have our house in order more than it was just a month ago."

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