Youbet Closes Pari-Mutuel Wagering Unit

Youbet.com Inc. will close its unprofitable pari-mutuel wagering account business due to a reduction in wagering. Woodland Hills-based Youbet acquired International Racing Group in 2005 for $3 million. Youbet expects to pay $500,000 in severance costs associated with shutting down the business, and another $200,000 to $300,000 to cover lease obligations, outside services, asset disposals and other miscellaneous costs. IRG had become unprofitable and showed no signs of turning around in the near future. It also is currently under investigation by the U.S. Attorney’s Office in Las Vegas. “The decision to close IRG was necessary as we continue to focus our management priorities on improving profitability and shareholder value,” said interim Chief Executive Officer Gary W. Sproule. IRC only accepted telephone wagers from predominantly high-volume customers for races at more than 90 thoroughbred, harness and greyhound tracks.