Playtech chiefs accuse Aristocrat of misinformation campaign in bidding battle
The current and former chief executive of Playtech have accused Australian games company Aristocrat Leisure and its advisers of orchestrating a campaign to protect its bid on the British games group by creating suspicion around a cabal of Asian investors.
The allegation breaks a silence maintained by former Playtech chief Tom Hall since October and the start of one of the UK’s most heated takeover battles in recent times.
In January, media reports speculated that a group of Asia-based investors supposedly rounded up by “Hong Kong Tom” – a nickname sometimes applied to Hall – were acting in concert to block the bid. 2.7 billion pounds sterling from Aristocrat on Playtech.
These allegations were based on a report by a private investigation firm and prompted an investigation by the UK Takeover Panel into the disputed process.
But Hall, chief executive of Playtech from 2003 to 2005 and a Hong Kong resident since 1989, said accusations that he acted as a conduit to a party of Asian shareholders were “garbage” and that discussions with the Takeover Panel revealed that key details it was presented with were false.
“As I explained to the Takeover Panel, I said I had never heard of these people or their advisers,” Hall told the Financial Times, referring to some of the names on the list of investors based in Asia. Other information received by the panel, including the timing of Hall’s purchase of Playtech shares, was also incorrect, he said.
Mor Weizer, the current chief executive of Playtech, claimed that opposition to Aristocrat’s bid, rejected in February by 45% of shareholders, also came from “other leading UK-based institutions, some former employees of the company, including some people who are still involved with the company” who felt that Aristocrat’s offer was too low.
Playtech, which provides back-end software to some of the world’s largest gambling companies, has long languished on the sidelines as consolidation swept through the betting industry as operators adjust to regulations. stricter in established markets and the opening up of the United States. and Latin America following moves to legalize betting.
In October, however, the bid from Aristocrat, which makes slot machines, prompted two separate expressions of interest from a subsidiary of Playtech’s second-largest shareholder, TTB Partners, and the former Formula 1 boss. , Eddie Jordan.
Shortly after Aristocrat’s offer at 680p per share was accepted by the board, a wave of investors bought Playtech shares at over 700p per share, raising initial suspicions of a conspiracy against his offer.
Among those who bought or increased their stakes were Paul Suen, the Chinese businessman known for floating Birmingham City Football Club and former Wigan Athletic owner Stanley Choi, but also investors based in Dublin and the UK. Isle of Man, according to regulatory documents.
The report lists “key links” between various Hong Kong-based investors and accuses some of “proximity to organized crime”, according to a redacted version seen by the Financial Times.
The aristocrat declined to comment.
Hall, who is currently working on a management buyout of Playtech with TTB-backed Weizer, said he described his trading in Playtech shares dating back three years and any contact he had with other shareholders. from Playtech to the Takeover Panel on several calls.
Hall owns 1.34% of the company, he said.
A person familiar with the Takeover Panel’s deliberations said the body does not consider investors with Hong Kong addresses to be working together.
Hall retired from managing game companies in December 2020 to focus on sports media, but continued to invest in game companies and said he disagreed with the company’s intentions. Aristocrat or Jordan’s JKO Play vehicle to dismantle Playtech by reviewing its operations in Asia or selling its Italian retail subsidiary Snaitech.
After the Aristocrat bid fell through, Hall entered talks with TTB, which withdrew its initial interest in November.
He asked Weizer to join the bid in mid-February to ease Playtech’s entry into the US market, where states have quickly introduced legal gambling since the repeal of a federal ban on the practice. in 2018. Weizer is personally licensed in multiple US states and led recent Playtech launches in Michigan and New Jersey.
The Playtech boss said if their bid fell through he risked having to resign from the company after 17 years. “I understand the consequences and I understand that they are also quite serious if this does not happen, but. . . at least i tried to do what is best for everyone involved.
The pair, backed by TTB and two major financial institutions in the UK and US, said they planned to submit a higher bid than Aristocrat to Playtech’s board “soon”.
Privatizing the company would spare Weizer the scrutiny it has faced in recent years, particularly over the level of its compensation, which has been the subject of several shareholder rebellions.