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  • Eminence Capital acquires £50.4m in Entain shares, shifting voting power
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Activist investor Ricky Sandler’s fund Eminence Capital has significantly increased its shareholding in Entain.

Eminence purchased 7.1 million shares in Entain on Monday (3 June) at a price of £7.10 per share, representing a total purchase price of £50.4m.

This brought the fund’s total shareholding to 37,154,030 shares, representing 5.8% of the total voting rights in Entain.

Eminence CEO Ricky Sandler has ultimate control over the voting rights.

Board members increase shareholdings

In a series of additional transactions, other board members and their spouses have significantly increased their shareholdings.

Chairman Barry Gibson purchased 5,066 shares at an average price of £6.85 per share, for a total of £34,785.18, increasing his total holdings to 137,500 shares.

Gibson recently announced his planned retirement by the end of September 2024, which could occur sooner pending the appointment of a permanent CEO.

Brenda Gibson, wife of Barry Gibson, also increased her stake in the FTSE 100-listed gambling group.

She purchased 5,066 shares at a slightly higher price of £6.87 each, also amounting to a total investment of £34,785.18. This transaction elevated her total shareholding to 62,500 shares.

Meanwhile Peter David, the husband of interim CEO Stella David, who is set to succeed Barry Gibson as chair, acquired 145,376 shares at £6.88 each, totalling approximately £999,939.77.

This purchase expanded Peter David’s holdings to 275,376 shares in Entain.

Stella David began acting as interim CEO following Jette Nygaard-Andersen’s abrupt departure in December 2023 due to increasing investor pressure.

Pierre Bouchut, a senior independent non-executive director at Entain, also participated in the recent trend of increasing stakes.

He purchased 10,000 shares at a price of £6.95 each, totalling £69,456. This acquisition increased his total number of shares in Entain to 48,500.

Following these transactions, Entain shares were trading up 0.98% at £7.21 as of mid-afternoon yesterday (5 June). The company’s market capitalisation stands at £4.63bn.

Financial analysts like Deutsche Bank Aktiengesellschaft, Jefferies Financial Group, and Berenberg Bank have all issued “Buy” ratings. Meanwhile, Barclays downgraded Entain to an “equal weight”.

Board dynamics and strategic movements

The investments come at a time when Entain is navigating through a pivotal restructuring phase.

In February, Sandler secured a position on Entain’s newly formed Capital Allocation Committee, after being granted a seat on the company’s board in January.

His appointment came with a relationship agreement that limited his ability to challenge management on certain issues.

Sandler had previously criticised the operator in summer 2023 for what he termed an “illogical” approach to funding acquisitions with undervalued shareholder capital.

Substantial share transactions also occurred among key executives back in 2023, amid ongoing strategic shifts in the business.

In November 2023, Gibson significantly increased his stake by acquiring 93,664 additional shares, while his wife also expanded her holdings.

Nygaard-Andersen and David also increased their shares to 65,381 and 95,025 respectively.

Entain’s share price saw a stark drop of over 28% in 2023, with shares reaching a three-year low.

In response, the company announced a new strategy late last year, including a renewed focus on high-growth markets, an exit of non-core markets, and a fresh approach to capital allocation.

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