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Novomatic backs down on Ainsworth stake

TAGs: ainsworth game technology, Novomatic

This article has been updated with Novomatic’s statement on the reduction of its Ainsworth stake.

Ainsworth Game Technology (AGT) adjusted its revenue upward twice this month, following several deals that improved its financial position. The news came a little late for the company’s controlling shareholder, however, who had already decided to retreat on its stake in the operations. In a filing with the Australian Securities Exchange, Ainsworth announced that Novomatic took a reduction in stake last May, dropping from 53.58% to 52.38% its control in the company.

Novomatic backs down on Ainsworth stakeNovomatic became the primary shareholder after it spent around US$350 million to purchase a major stake in the company in January. That purchase had begun about two years prior.

With the acquisition, Novomatic gained access to new markets in the U.S. and Asia, with Novomatic Chief Technology Officer Thomas Graf saying at the time that Ainsworth had “superior gaming technology, clear industry expertise and [an] impressive international footprint, especially in the U.S. market.”

Ainsworth reported less than two weeks ago that it expected its revenue for the second half of 2018 to reach US$26.5 million. This was an increase of US$11.8 million over previous expectations and came after the company signed a significant deal with Churchill Downs. That adjustment came after its previous fiscal year before-tax profits were adjusted to US$28.97 million, up US$2.48 million over the previously reported US$26.49 million.

In a statement to CalvinAyre.com, Novomatic’s Head of Group Communications Bernhard Krumpel explained, “…the change as outlined by the recent announcement on Novomatic’s percentage ownership in Ainsworth was a direct result of dilution through the issuing of new shares by Ainsworth through the Dividend Reinvestment Plan (DRP) in May and November 2016 prior to Novomatic completing its ownership of the shares from Mr. LH Ainsworth and entities controlled by him.”

“In fact, Novomatic confirmed its commitment to Ainsworth through a full take up of its entitlement for the interim dividend in May 2018 once the completion of the transaction had occurred.  These factors resulted in a change in percentage ownership as required under Australian regulatory requirements,” Krumpel said.

Harald Neumann, Novomatic CEO, said in early July that the company’s revenue in the first half of 2017 climbed to more than US$1.4 billion. The company has increased its footprint of casinos, bingo facilities and sports betting outlets around the world from 1,800 to 2,100 and also now operates around 70,700 gaming devices. This is a substantial increase over the 9,000 reported in 2017.

Most recently, Novomatic announced that it has partnered with several entities to launch a Corporate Coding Academy, a training facility for company game developers. It is expected to be fully operational by November and will provide a six-month intensive program specifically customized for the gaming industry.

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