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CryptoLogic moves to Ireland

By Tavia Grant
September 25, 2006

Internet gambling software company CryptoLogic Inc. said Monday it will move its headquarters to Ireland in January, a move that comes amid a U.S. crackdown on the industry.

Lewis Rose, the company's chief executive, isn't moving to Ireland permanently because of “family reasons,” the company said. Toronto-based CryptoLogic has already begun a search for a new CEO and is expected to name his replacement next year.

Several other senior executives — including chief financial officer Stephen Taylor — will start work in Ireland by Jan. 1, while CryptoLogic's software development team will remain in Canada. The move is subject to regulatory and shareholder approval.

“CryptoLogic's business is increasingly centred in Europe, and establishing our organization in that market is the logical next step to support our international growth plans,” Mr. Rose said in a release.

“For CryptoLogic, this is about being closer to our customers, and to the world's most thriving Internet gaming markets.”

The shift comes several months after U.S. officials charged 11 people who run Internet gambling sites, including the chief executive officer of a British gambling site, with various offences including racketeering, conspiracy and fraud. U.S. legislators also want new measures to toughen the existing ban.

CryptoLogic said Monday it wants to move to a “gaming-friendly environment” that lets the company provide “a wider range of marketing support and brand management services to licensees.”

More than 60 per cent of licensees' revenue now comes from the U.K. and continental Europe, it said.

The U.K. has emerged as the global capital for Internet gambling. CryptoLogic now plans to make the Alternative Investment Market of the London Stock Exchange its primary market. It will still keep its Toronto and Nasdaq listings.

The company plans to exchange its common shares for shares in a new Irish-based company, to be called CryptoLogic PLC. The move is expected to cost about $8.5-million.

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