Novomatic acquired 52.9% of AGI from Len Ainsworth in 2018 for $2.75 per share. According to the information in its most recent disclosures, AGI is profitable and well-placed for growth.

During the last six financial years of Novomatic’s majority ownership of AGI, no dividends were paid despite adequate funding to do so. Over the period AGI’s share price has fallen nearly 64 per cent. Shareholder returns have instead been spent on an acquisition, high levels of Research and Development, tax penalties and debt reduction.

Novomatic is proposing to buy the remaining outstanding shares in AGI it does not own at slightly more than a third of the original purchase price it paid for the first 52.9% of AGI. This is despite AGI showing good potential for growth according to its own statements.

A sale to Novomatic at $1.00 would deprive minority shareholders of the opportunity to benefit from a company that has invested returns in “further accelerating growth objectives” in “future periods” right at the moment in time the company has launched and will likely benefit from the outstanding new Raptor Cabinet and several interesting new games.

Below are three key points:

1: AGI is undervalued at $1 per share
2: Novomatic’s conduct raises questions
3: AGI has excellent prospects

1. AGI is undervalued at $1 per share

It is clear from reading AGI’s disclosures over several years that:

i. Demand for AGI’s shares have been suppressed by the AGI board and CEO’s actions. AGI has not paid a dividend since 2019, despite being profitable every year except 2023. The company has vastly expanded R&D expenditure to 17% of revenue, completed the acquisition of MTD Gaming Inc. and used cash to repay all company debt whilst taking out new lines of debt to the value of USD$75m; handicapping the company’s free cash flow and profitability. The company could have achieved most of the above and easily paid a dividend in all but 2023.

ii. AGI’s property is undervalued. Property assets are valued at USD$44.5M in AGI’s 2024 Annual Report, which is their historical purchase price, after depreciation and adjustment for currency fluctuation. An independent valuation carried out in late June 2025 by Valbridge Valuers valued AGI’s property assets at USD$76.0M. This represents a 69.6% difference – or $0.19 per share – from the value disclosed to the market, an anomaly not noted by the Scheme’s Independent Expert Report. The company has yet to justify this accounting anomaly.

iii. AGI is performing well. The Independent Expert Report suggests AGI will make a Net Profit After Tax of AUD$49M in 2025, which represents ~AUD$37.5M in profits in the nine months since the last financial report. This alone is a value of more than $0.11 per share. The company has a very strong Net Asset backing with almost no debt. Based on the 2024 Annual Report, AGI shares at $1.00 are trading at an 8.4% discount to its Net Asset Backing and only a 12% premium to Net Tangible Assets.

2. Novomatic’s conduct raises questions

Novomatic and AGI have questions to answer regarding the above issues.

i. AGI’s CEO, Harald Neumann is the former CEO of Novomatic and presumably the architect of the Scheme. Mr Neumann is the subject of an ongoing corruption probe concerning his alleged conduct while CEO of Novomatic; and separate tax evasion investigations related to two “personal”, €1M payments he received in 2018 and 2019 from the founder and owner of Novomatic, Johann Graf.

The optics of Novomatic appointing Mr Neumann to lead AGI, Mr Neumann managing the company through a 64% fall in investor value, and then selling AGI to Novomatic for a low price, are unfavourable at best.

ii. Expenditure by AGI. There have been large outflows of cash on R&D, which has handicapped AGI’s cashflow and profit. The profit results thereafter have in turn been used in the Independent Expert Report to compute the EV EBITDA in comparison to a limited selection of other industry participants. This comparison of EV EBITDA multiples is utilised as a major justification for the scheme’s $1.00 offer price. By adjusting the R&D spend significantly and unjustifiably, even for a short period, the $1.00 offer price has been made to look “fair and reasonable” in the Independent Expert Report. A deliberate lack of financial gearing further compounds the EV EBITDA calculation in favour of Novomatic’s intentions. There are additionally, related-party transactions documented in the Annual Reports that consistently net-out substantially in favour of Novomatic without any detailed explanation.

iii. The timing of the Scheme of Arrangement. AGI has used cashflow from earnings to repay its debt in the past three years. The use of profits to finalise the repayment of debt without any dividend to shareholders coincides with the timing of the Novomatic offer. Investors have not received a report on the performance of the company since December 30, 2024. This is critical as it coincides with the launch of the Raptor product line in February 2025 and the emergence of several new games for use in the Raptor product.

3. AGI has excellent prospects

In contrast to the tone of the Scheme Booklet and Mr Neumann’s unjustifiably downbeat demeanour at the 2023 and 2024 Annual General Meetings, AGI’s business is highly competitive and does not need a takeover nor Novomatic to survive or thrive:

i. the global slot machine market was valued at ~USD16.8billion in 2024 and is projected to reach USD28.3billion by 2034. AGI is currently the world’s 7^th largest manufacturer by revenue, with significant room and capability for growth, and an inherent home grown advantage under the USA’s global tariff programme.

ii. AGI has strong cashflow, good profit margins, and several thousand machines profitably on participation in leading gaming facilities. It is however choosing to spend excessively on Research and Development.

iii. If AGI’s future plans come to fruition and the company is listed successfully on a US stock market, as Mr Neumann stated he would do so several years ago; the company’s share price would in my opinion be very substantially higher than it is now.

Like my predecessors, I believe in treating shareholders as business partners who share the gains of a company. Despite Novomatic making all the right noises about shared growth when buying into the company, it has arguably fallen well short of its commitments to date. Novomatic is seeking to squeeze out shareholders at precisely the time the company is set for dramatically improved results.

The Scheme prevents AGI shareholders from realising substantial ongoing future growth in the value of AGI at a time when the company is trading very successfully and has excellent prospects.

What's really going on here? I’d encourage to shareholders to stay the course, Vote “No” to Novomatic and contribute to a much better longer term outcome for AGI.