Novomatic has taken another step toward acquiring Ainsworth Game Technology (AGT), keeping its previous valuation, which it described as the “best and final.”
In addition to the previously proposed scheme of arrangement, the Austrian operator announced a new cash offer to buy shares of the Australian poker machine manufacturer.
The price remains unchanged — 1 Australian dollar ($0.64) per share, representing a 35% premium over AGT’s current share price. As the offer is unconditional, Novomatic can also purchase Ainsworth shares on the open market at $1 per share or below.
Shareholder Reaction
Novomatic, which already controls 52.9% of AGT’s shares, made the new offer in response to shareholder criticism.
Kjerulf Ainsworth, son of the company’s founder Len Ainsworth and the second-largest shareholder, said the offer undervalues AGT’s U.S. assets. In his view, a fair price should be around $3 per share.
“We’d like full access to the properties for an updated valuation,” he told the Australian Financial Review in July. “A clear answer on when the properties were last valued, by whom, the assessed value and the methodology … an answer as to why the independent board about the scheme has not addressed the property valuations.”
Other AGT shareholders, including Allan Gray, Spheria Asset Management, and Kanen Wealth Management, expressed dissatisfaction with the offer, noting that it undervalues the company.
Novomatic acknowledged that a “small number of shareholders” did not support the scheme but emphasized that providing the option to sell shares under the takeover offer leaves the decision in the hands of individual AGT shareholders.
“Novomatic’s unconditional takeover offer provides instant liquidity to all Ainsworth shareholders and allows each shareholder to make their own decision regarding the offer, regardless of the outcome of the scheme meeting,” said Novomatic Board Member Stefan Krenn.
AGT’s independent board committee has backed the offers and recommended that shareholders accept both, in the absence of a superior proposal.
Next Steps
A shareholders’ meeting to vote on the scheme of arrangement is scheduled for 29 August, although Novomatic expects AGT may apply to the court to postpone the meeting in light of the new offer.
If shareholders do not approve the scheme, Novomatic has stated its intention to take a more active role in managing its stake in Ainsworth.
Planned measures include increasing Novomatic’s representation on AGT’s board by appointing a fifth director from the company, as well as conducting a strategic review of AGT’s operations.
Additionally, Novomatic has announced plans to delist AGT from the ASX if its stake exceeds 75%.
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