Mystery Abounds as 138.com Shuts operations; M88 leaves Malaysian, Cambodian Market

Mystery abounds as online gambling operator 138.com shuts down for unknown reasons. Another operator, Mansion88, also exited Malaysia and Cambodia. 

 

At the beginning of this month, several Asian affiliates started reported that 138Bet/138.com would shut down operations. The operator, in a statement, assured customers that they would be allowed to withdraw funds from their user accounts, and also informed suppliers that they would cease their cooperation. 

 

Reasons for 138.com’s rushed exit are not clear. Some gambling affiliates stated that the website would be closed temporarily because their supports based in the Philippines were offline due to lockdown in the country. However, this seems highly unlikely, considering that 138.com has gone offline completely. 

 

Supplementary sources think otherwise, claiming that the reason the site went offline is that its parent company, Suncity Group, is under immense pressure from key stakeholders, who want the company to disassociate with online operators completely. In other news, M88 is scheduled to withdraw its services from Malaysia and Cambodia from the 31st of May. Its customers were notified that the company would discontinue all its promotions starting on the 25th of May. However, they will be allowed to continue gambling with whatever balance is in their accounts. Those wanting to withdraw should do so by the 31st of May. 

 

The company claimed that Malaysia and Cambodia are small markets, compared to Vietnam, China, and Thailand. However, quick research has shown that the company has been recruiting gamblers, propagating the notion that it is the most popular operator in both countries.

Malaysian gambling crackdown forces Playtech to issue profit warning

Problems in Asia and a troublesome bingo contract have forced gaming and spread-betting company Playtech to issue a profit warning sending the shares plunging by a fifth.

Management at the Isle of Man-based business, which was founded by billionaire Teddy Sagi, said it expected annual profits to be 5pc lower than the bottom end of market expectations, prompting analysts to wipe about €20m (£17.8m) off their full-year earnings forecasts and sending Playtech shares down 218.5p to 768p.

A key problem for the company is understood to be Malaysia, which is presently an unregulated market and has seen its government move to prevent citizens from accessing online gambling sites and mobile apps.

The country’s leaders are considering changes to its Common Gaming House Act 1953 to plug loopholes which enable citizens to gamble online.

Deputy Prime Minister Ahmad Zahid Hamidi is quoted as saying that the government hasn’t decided on whether the change of the law will be in the form of an amendment or if the parliament will craft a new preventive law that will specifically target online gambling activities.

Analysts at Investec predicted the Malaysia issue was responsible for the bulk of the value of the profit downgrade by the company.

Investec added it thought Malaysia represented 5pc of Playtech’s total revenue, which came in at €709m in 2016.

Elsewhere, its contract with Sun Bingo, which involves Playtech providing the technology for the game, has continued to be problematic.

Earlier this year Playtech chief executive Mor Weizer admitted it had been forced to spend more money than planned to attract customers and that it was a year behind where it wanted to be with the project.

In its update this week, the company said the contract “remains challenging” partly due to the re-launch of the new Sun Bingo site.

The company’s financial division Tradetech, which serves professional traders, has performed as expected.