April 28, 2011

Gambling.com sells for $2.5 million

The UK’s Media Corp plc. has completed the sale of its Gambling.com domain name for US$2.5m in cash, well below its stated balance sheet value of $4.25m.

The company did not reveal the identity of the acquirer, but stated that the transaction includes only the Gambling.com domain name and website.

Media Corp said it will retain ownership of a number of significant assets relating to the business, including intellectual property, customer databases and infrastructure, which it said would provide significant economic benefit to purplelounge.com, the Group’s online gaming business.

“The sale of Gambling.com brings a significant boost to the Group’s already substantial cash reserves; we have recently seen a number of exciting acquisition opportunities in the online gaming and online advertising space. The successful sale of gambling.com has given the Group more than adequate financial resources to pursue these acquisition opportunities aggressively,” said Justin Drummond, CEO of Media Corporation plc.

As a result of the shortfall between the sale price of the domain name and its book value, Media Corp will incur a one-off loss in the current financial year of $1.75 million relating to the transaction.

The company said that the $2.5m sale price, together with the $13.2m in revenues generated by the website in the past five years, was a satisfactory result.

Investors, however, appear to have taken a different view, with shares in Media Corp plc falling 10.64 per cent in London this morning to 2.10 pence per share, just above their 52-week low of 2.08 pence.

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