An American shareholder of pokies supplier Ainsworth Game Technology has accused the company of talking down the value of the stock and limiting it to “obscurity”, slamming a strategic review process which he says has depressed the share price.
Ainsworth is considering whether to take itself private for its next stage of growth and has hired Macquarie to conduct a review designed to maximize value for shareholders.
At the company’s annual results last week, Ainsworth chief executive Harald Neumann ruled out one option – listing the stock in the US. He said the outcome of the review would be determined later this year.
Speaking with the Australian Financial Review over the weekend, David Kanen of Kanen Wealth Management – which holds around 8 million Ainsworth shares, stated his belief that the business was “severely undervalued” after Ainsworth CEO Harald Neumann told investors a secondary listing in the United States was not an option.
“I believe our CEO talked the stock down,” Kanen said. “By limiting themselves to being in obscurity, solely on the Australian exchange … they’re missing a much bigger sized audience. Remaining in obscurity results in low volume, lower valuation and lack of price discovery, no US research coverage.”
According to the AFR report, Neumann claims a secondary listing would cost the company around AU$10 million but a number of shareholders, including Karen, dispute this – instead putting the cost at less than AU$2 million.
The AFR has named Oaktree, American Gaming Systems, Zitro Games and Merkur Group among other potential suitors for the Australian firm.
