TVG has passed on exercising a warrant that would have given it 51 per cent of UBET at $1.69 a share. UBET closed at $3.78 today. Instead, TVG chose to take one million shares of UBET, adding to some four million it already owns.
TVG already earns perhaps about $10M yearly by granting UBET rights to accept wagers on TVG's exclusive tracks, i.e. Churchill Downs and all the major New York State tracks. TVG gets the lion's share of the net from every dollar wagered on UBET's platform and will continue to do so.
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Youbet Announces TVG Will Not Exercise Warrant
Wednesday March 31
WOODLAND HILLS, Calif.--(BUSINESS WIRE)--March 31, 2004--Youbet.com, Inc. (Nasdaq:UBET - News) announced today that ODS Technologies, L.P., D/B/A TVG Network, a subsidiary of Gemstar-TV Guide International (TVG), notified Youbet that it will not exercise a warrant issued to TVG which, when aggregated with the shares acquired pursuant to the exercise of a prior warrant to TVG, would have entitled TVG to 51% of the outstanding shares of Youbet and certain Board representation.
Pursuant to a previously announced settlement agreement between the two companies, Youbet will issue one million shares of Youbet common stock as a result of TVG's providing notice by April 1, 2004. The warrant was originally scheduled to expire on May 18, 2004. In addition to the one million shares, TVG presently owns approximately four million shares of Youbet.
If the warrant had been exercised, TVG was required to pay approximately $36.5 million to Youbet resulting in a dilutive impact to existing shareholders. TVG would have received approximately 21.6 million shares resulting in an effective price per share of approximately $1.69.
Youbet will continue to carry TVG's exclusive horse racing signals on its industry-leading online advanced deposit wagering site through its licensing agreement with TVG. Headquartered in Woodland Hills, California, Youbet is the largest Internet provider of thoroughbred, harness and quarter horse racing in the United States.
Youbet subscribers can watch and, in most states, wager on nearly all major domestic horse racing content through an exclusive closed-loop network. Members enjoy commingled track pools, live audio/video, up-to-the-minute track information, real-time wagering information, phone wagering and value-added handicapping products.
Youbet.com is a patent and content licensee and maintains strategic relationships with TVG, an indirect subsidiary of Gemstar-TV Guide International, Inc. (Nasdaq:GMST - News) and MEC Pennsylvania Racing, part of Magna Entertainment Corp. (Nasdaq:MIEC - News). Youbet.com is an official online wagering platform of Churchill Downs Incorporated and the Kentucky Derby.
Youbet.com operates Youbet.com TotalAccess(TM), an Oregon-based hub for the acceptance and placement of wagers. More information on Youbet.com can be found at www.Youbet.com. |
