Social game developer Zynga stocks are up 9% on speculation that New Jersey may legalize internet gambling. Last week New Jersey Governor Chris Christie vetoed an internet gambling bill but said he would sign it if certain changes were made. Democrats supported Christie’s position and the bill could become law as soon as early March. According to a report by Reuters the bill would clear the way for European internet gaming businesses to enter the lucrative US market.
Last December Zynga applied for a Nevada license and filed papers with the Nevada gaming control board. Zynga Chief Revenue officer, Barry Cottle, told reporters, “Zynga has filed its Application for a Preliminary Finding of Suitability from the Nevada Gaming Control Board. This filing continues our strategic effort to enter regulated RMG markets in a prudent way. We anticipate that the process will take approximately 12 to 18 months to complete. As we’ve said previously, the broader U.S. market is an opportunity that’s further out on the horizon, based on legislative developments, but we are preparing for a regulated market. We’ve also recently partnered with bwin.party to bring the highest quality real money gaming experiences to our UK players in the first half of 2013.”
Zynga’s moves are no surprise since the company has expressed its intention to enter the internet gaming industry several times. Zynga signed a deal with British based Poker Company Bwin.party digital entertainment to offer online casino and poker games for real money in the UK. According to the signed deal the company will offer 180 games including poker, slots, roulette, and blackjack during the first half of 2013.
Zynga (NASDAQ:ZNGA) shares have been rising steadily since the beginning of February. Some reports say that if Zynga can get a foothold in the internet gambling sector the company could see an annual increase of $200 million in annual revenues. Recently some of Zynga’s top executives left to form their own gaming company. Some of the former execs formed a social gaming company called Bee Cave Games. The company has already managed to raise $1.4 million for games development.
Shares of Zynga are the highest they have been in six months. The stock still has a way to go to approach the $15 per share it traded at in early 2012. Many investors remain optimistic about the future of the social gaming company.