But Bwin says the move is welcome because it provides clarity
At least some Bwin.Party Digital Entertainment investors appeared to disagree with chairman Philip Yea's statement Friday that the company welcomed the placement of 50 million shares in the company by Emerald Bay Limited and Stinson Ridge Limited… Bwin shares took an 11 percent hit as the news broke.
Emerald and Stinson were created as part of the divestiture of Party Gaming founders Ruth Parasol and J Russell DeLeon. The duo's shares were placed in 36-month divestiture trusts, which were established in November 2013 in order to comply with New Jersey Gaming Enforcement Division requirements for the re-entry of Bwin.Party into the US market.
Through the trusts, Parasol and De Leon directed the sale of 6 percent of shares, and reserved the right to appoint shareholder activist Jason Ader of Spring Owl as a board member (see previous InfoPowa reports).
The Bwin Party announcement in 2013 regarding the divestiture revealed:
"Emerald Bay Limited, wholly-owned by Ruth Parasol DeLeon, and Stinson Ridge Limited, wholly-owned by James Russell DeLeon have elected, pursuant to a divorce settlement and for reasons of privacy, to enter into a divestiture agreement with bwin.party and the DGE, rather than submit individual Licence applications.
"Emerald currently owns 58,498,667 (7.16 percent) bwin.party shares and Stinson currently owns 58,498,666 (7.16 percent) bwin.party shares.
"Under the terms of the Divestiture Agreement, the Substantial Shareholders have respectively agreed, subject to the conditions described below, to transfer their entire holding of bwin.party shares into separate trusts, and such bwin.party shares will thereafter be divested by the trustees of their respective trusts, working together, in one or more transactions."
In Friday's Bwin.Party statement on the placing, the company revealed that it was aware that the trustees of the two trusts had chosen to place up to 50 million shares in bwin.party.
"Whilst the Board was not party to the placing arrangements, they are consistent with the Trustees' obligations to sell down their holdings before the end of October 2015 under the terms of the divestiture arrangements that were entered into by both Emerald and Stinson and which were disclosed in a press announcement issued by the Company on ," the statement noted.
Philip Yea, chairman of bwin.party, commented on the move, saying:
"We welcome today's news regarding the placing by the Trustees as it provides clarity for the market regarding a significant block of shares that were due to be sold during 2015. The sale has no bearing on the Board's discussions regarding proposals received from third parties that are continuing, and whilst there can be no guarantee that these discussions will result in any transaction taking place, the Board will make further announcements in due course."
City analysts said the market had been "unnerved" by the placing announcement at 93p a share when the closing price Thursday was 105p, suggesting that there may have been some difficulty in placing the shares.
Online Casino News Courtesy of Infopowa