NEW YORK (
announced on Thursday a partnership with online poker giant
to push the legalization of Internet gaming in the U.S.
CEO Steve Wynn said in a statement that law enforcement doesn't have the tools to stop Internet gambling, and that lawmakers should legalize and regulate the activity to create thousands of jobs and tax revenue for the United States.
As part of the agreement, the two companies plan to run a site called PokerStarsWynn.com, should legislation pass.
The news comes the same day PokerStarts pushed lawmakers in Carson City, Nev., to adopt a bill that would legalize online poker.
Nevada introduced a bill earlier in the month asking state gambling regulators to create rules for Internet poker operators and companies that make related equipment. It would also specifically prevent the Nevada Gaming Commission from denying a license to popular existing poker sites -- like PokerStars and Full Tilt Poker -- just because they have been operating offshore in a legal gray area after a federal law effectively banned online gambling in 2006.
has said that the bill needs to be revised before it can get behind it.
Also on Thursday,
won approval from Nevada regulators allowing it to partner with 888 Holdings to run a branded online gambling site in the United Kingdom.
But New Jersey Governor Chris Christie vetoed a bill in March that would have made the state the first to legalize Internet gambling.
"While we believe online gaming in the U.S. is a ways away from coming to fruition, the move provides Wynn with a partner that is far and away the largest in the online poker arena," Wells Fargo analyst Carlo Santarelli, wrote in a note.
PokerStars' liquidity is nearly two times that of the next largest site, Full Tilt Poker.
While there are few reliable statistics regarding the current size of the domestic online poker market, it was estimated to be a $2.4 billion market in 2005, prior to UIEGA, Santarelli notes. He estimates, conservatively, that the market is greater than $4 billion in annual revenue.
Assuming that the market would grow to about $6 billion once legalized, Santarelli predicts the Wynn partnership could result in about $600 million annually. "At a 10x multiple, we believe the venture into online poker is worth, at a minimum, $10 per share in equity value to Wynn, should online legislation one day pass."
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--Written by Jeanine Poggi in New York.
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