July 29 was the deadline for the filing of applications for internet gambling license in the State of New Jersey for the go-live date of November 26, 2013. Among the 37 vendors filing applications was the British online gambling company 2UP Gaming PLC. 2UP is a publicly-traded (GXG:2GM) online gaming and wagering company based in London with an operations office located in West Melbourne, Australia.
The new legislation in New Jersey requires vendors to partner with a bricks-n-mortar casino located in Atlantic City before they can legally offer online gaming in the United States. Until New Jersey passed this law the only states licensing internet gaming operations in the U.S. were Delaware and Nevada. The Nevada-licensed Ultimate Poker is currently the only online gaming company operating legally in the U.S.
2UP has partnered with the New York City-based venture capital firm MidOil USA and together they are currently looking for an Atlantic City casino to form a partnership with, but with 37 applications for online gaming and only 12 existing casinos the prospects for a deal are far from certain. In addition to the $75 million contribution from MidOil, an Asian investment firm has committed another £215 million to the purchase or construction of a casino in Atlantic City. A lack of capital should not be a problem since recent sale negotiations for two Atlantic City casinos hovered between $15 and $20 million dollars due to the severely depressed real estate market.
The expansion of 2UP’s customer base into the U.S. market is a part of their strategy to become the leading online gaming site globally. In January of this year, 2UP announced the purchase of DBG Poker Group, thereby gaining access to proprietary, cutting edge technology that allows customers to experience “live dealers” online when playing poker, blackjack, baccarat, or roulette. From the perspective of 2UP, the American market must seem like the Wild West with only one legal competitor in play. After only 3 months of offering online gaming an Ultimate Poker customer recently won the 10 millionth hand. That amounts to over 110,000 hands per day on average. However, with 37 internet gaming companies filing applications in New Jersey in preparation for the go-live date in November, the U.S. market for legal online gambling will quickly become competitive. Whether 2UP will be able to throw their hat in the ring this year will depend on whether they find a casino to partner with.