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For long time readers of Gambling911.com this may all seem like déjà vu. It was reported Tuesday that an activist investor could be looking to shake things up at online gambling giant Bwin.Party.
Now we know a little more as to who this activist investor actually is. It’s none other than Jason Ader. That name may ring a bell to those of you who follow the news daily here at Gambling911.com.
It was a year to the day, February 18, 2013, that the Las Vegas Review Journal picked up on Gambling911.com’s coverage of the nasty proxy fight launched by Ader at slot maker International Game Technology (IGT), ultimately leading to his group landing a hand-picked member on that company’s board. IGT had enjoyed great success since that time with shares hitting a high of 21.20 over the summer, the highest we’ve seen in years.
And that success carried over into the new year until they hit a roadblock late last month with shares in IGT plunging 11% on news that its quarterly results and outlook disappointed Wall Street.
Fool.com’s Brian Pacampara noted that “gross margin fell 200 basis points over the year-ago period to 61%, suggesting that IGT's competitive position is getting more expensive to maintain”.
And with today’s announcement of Ader’s return via his new fund SpringOwl, Ashley Armstrong of the Telegraph suggests it would appear that corporate raiders, long scorned by Wall Street and the Square Mile, are refashioning themselves into respectable shareholders who vocally push for change.
Bwin.Party Digital Entertainment’s shares rose 6, or 5.31pc, to 119p on the news.
The shares are being offloaded by bwin.party’s founders, Ruth DeLeon and Russell DeLeon, who are required to sell their stakes in the company as part of their divorce agreement.
For SpringOwl, this was the fund’s first deal and, if it’s anything like the long drawn out IGT affair, we may be in for a rocky ride over at Bwin.Party, a company that is already making its mark on the regulated US landscape by taking control of nearly half the legalized Web gambling market in New Jersey.
Mr Ader “feels the company is undervalued and is looking to see it reach its potential”, the spokesman added.
Gambling911.com has plenty of sources tied in with Ader so you can rest assured we will be covering this story extensively as new developments occur.
- Jagajeet Chiba, Gambling911.com
