Waiting on some positive news, page-59

Ainsworth Game Technology investors await founder's cash-out
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Len Ainsworth, who owns 53 per cent of Ainsworth Game Technology, plans to sell his stake to privately held Austrian gaming giant Novomatic at $2.75 a share netting a $473 million windfall for the gaming magnate. Dominic Lorrimer

After a rollercoaster few years that have seen Ainsworth Game Technology ride the highs and lows of the sometimes fickle poker machine market, the latest twist hinges on whether the founder and chairman will be able to successfully cash out his chips.

The 92-year-old Len Ainsworth, who owns 53 per cent of the Sydney-based company, plans to sell his stake to privately held Austrian gaming giant Novomatic at $2.75, a share netting a $473 million windfall for the gaming magnate.

Some minorities are unhappy with that proposal on several fronts. They worry that Mr Ainsworth's wife, Gretel, may be able to claim minority status and use her 8 per cent share in the company to help vote through the deal at a coming extraordinary general meeting.

They also argue that if $2.75 a share is being thrown about for Mr Ainsworth, it is surely worth putting the entire company on the block and seeing the level of indicative offers that might come to the market.
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Ainsworth Game Technology share price over the past 3 months.
Stepping back from the family drama, should the Novomatic transaction proceed it could prove a boon for the nuts and bolts of AGT as it works to wrest back Australian market share off archrival Aristocrat Leisure while building on its promising sales growth in North America.

Novomatic does not have a major presence in either of these markets, and by combining its deep pockets with AGT's nous in developing popular pokie titles and sniffing out new markets, investors could see the combined company emerge as a much more powerful player against both Aristocrat and international competitors like IGT, Bally and Scientific Games.

Novomatic says it will be content with a majority stake while letting AGT's management team control the day-to-day business. But it is hardly surprising there is already growing speculation that within a year or two it could lead to a full-takeover scenario should the initial deal proceed smoothly.

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