SOURCE: Bloomberg

Sportingbet Plc, the Web bookmaker that owns Paradise Poker, said talks about a possible takeover by Austria's Bwin Interactive Entertainment AG have ended.

The discussions, first made public in March, were terminated ``mutually and amicably,'' the London-based company said today in a Regulatory News Service statement.

Online gaming operators have considered mergers and acquisitions as a way of replacing lost revenue after the U.S. banned Web gambling last year. The arrest of industry executives in the U.S. and Europe in 2006 may have discouraged transactions because of potential legal risks, analysts have said.

Konrad Sveceny, head of investors relations at Bwin, said the companies weren't able to agree on conditions because of legal complexities and regulatory changes in the industry.

``It's a pity that it hasn't gone ahead'' because ``the market needs to consolidate,'' said Warwick Bartlett, lead partner at Global Betting and Gaming Consultants in West Bromwich, central England.

Simon Gregory, Sportingbet's head of business development, was not immediately available for comment. Sportingbet said in June the discussions with Vienna-based Bwin involved ``complex legal, regulatory and operational issues.''

Shares Drop

Shares of Sportingbet fell 1 penny, or 1.7 percent, to 57.75 pence in London, rebounding from a slide of as much as 11 percent. The drop cut the company's market value to 250 million pounds ($504 million). Bwin stock rose 60 cents, or 2.5 percent, to 24.72 euros in Vienna, valuing the company at 806 million euros ($1.1 billion).

In April, the world's largest publicly traded bookmaker, Ladbrokes Plc, said discussions to acquire online gambling company 888 Holdings Plc ended after almost six months. 888 has also held talks with larger competitor PartyGaming Plc, according to people familiar with the situation.

Bwin considered buying Sportingbet to add more than 200,000 sports betting customers in Europe.