what a frustrating blue chip, page-14

in today's financial review Chanticleer column (almost a full page on the gaming industry).

TabCorp, UniTab, PBL and TTS gets a mention for continued speculation about corporate takeover activity.

The renewal of the 2012 gaming licences is expected to be resolved in early 2007.



My Comments:

Legislative requirement is for poker machines to return 87 cents in the dollar to punters. TabCorp and TTS have chosen to return 90 cents in the dollar. This provides a 3 cents "buffer" should there be a future need for a "re-carving" of the share of the "pie".

As for gaming licence renewal, incumbency with existing infrastructure, systems and procedures could provide an advantage (logically).

TTS with a debt free balance sheet, $300 million cash in the bank and lower historical P/E and prospective P/E 06 and 07, lower market capitalisation than TabCorp, (although higher market capitalisation than UniTab), might provide a better target than TabCorp or UniTab.

UniTab is trading at a premium P/E.