Bwin.party shareholders urged to vote against SpringOwl resolutions

28 April 2014

The board of online gaming operator bwin.party has written to its shareholders, urging them to vote against resolutions put forward by activist investor SpringOwl.

As reported by iGaming Business, SpringOwl last week submitted a number of resolutions, including its intention to place four representatives on the bwin.party board, ahead of the firm’s AGM in Gibraltar on May 22.

SpringOwl gained the right to put forward a single nominee under the terms of the ‘Relationship Agreement’ it reached after it purchased a 6.1% stake from the operator’s founders when they divorced. The four other nominees would be in addition to the existing right.

The Telegraph newspaper named the four nominees as Michael Fertik, a US technology entrepreneur, Francis Grady, founder of a law firm that specialises in US banking regulation, Kalendu Patel, a venture capitalist, and Steven Ritto, a well-known individual in the US gaming sector.

However, bwin.party has responded by recommending that its shareholders ‘vote against’ the resolutions due to the lack of information it has received on the nominees proposed and that the resolutions would not be in the best interests of the company.

Bwin.party said: “On the limited information presented to date by SpringOwl on each of the proposed director nominees, and having consulted with many of its leading shareholders and depositary interest holders, the board is recommending that shareholders and depositary interest holders vote against the SpringOwl resolutions.”

Bwin.party said that the board’s nomination committee needs “sufficient information and time” to review and interview candidates in order to determine their suitability for the role.

The operator said it had been provided with “very little information” on each of the nominees and it would require information of their background as the individual may have to be licensed to qualify under state online gaming regulations in the US.

Bwin.party said it must also be given time to consider how such appointments might impact the board’s composition as well as the process of overseeing the implementation of its business strategy.

The operator said SpringOwl was attempting to “by-pass” this routine process, thus “putting at risk the ability of the board to operate as a unified and effective forum in the best interests of all shareholders and depositary interest holders”.

In addition, Bwin.party said it would not be in the best interests of the firm, its shareholders and depositary interest holders for a minority shareholder, which now only owns a 5.2% stake, to nominate up to five directors.

Related article: Bwin.party activist investor nominates four board representatives