Entain, parent company of Ladbrokes and co-owner of BetMGM, is undergoing shifts in leadership as CEO Jette Nygaard-Andersen steps down amidst mounting pressure from investors and a lackluster stock performance.
In an official statement released on Wednesday, Entain announced that Stella David, presently a non-executive director, will take over as interim CEO this week, filling Nygaard-Andersen’s position.
The company’s shares, having dipped approximately 37% during Nygaard-Andersen’s nearly three-year tenure, showed a 4.9% surge in London trading following the news.
Despite BetMGM’s revenue growth amid the expanding US sports betting market during Nygaard-Andersen’s tenure, activist investors criticized her for what they deemed poor deal-making decisions.
The company engaged in around ten deals since 2021 under her leadership, aiming to expand its global presence. However, the recent funding strategy for a bid on Polish sports betting firm STS Holding, utilizing an equity sale, was met with severe disapproval from investors, including activist fund Eminence Capital.
Further intensifying the situation, other hedge funds, including Sachem Head Capital Management, Dendur Capital, and P Schoenfeld Asset Mgmt LP, have built stakes in Entain. Eminence Capital hinted at investor support for a revived deal with MGM Resorts International, which previously attempted an $11 billion acquisition of Entain.
Nygaard-Andersen’s departure follows an investigation by the UK tax authority over bribery allegations related to Entain’s former Turkish business, recently settled with a hefty $770.19 million (£615 million) payment.
Barry Gibson, Entain’s chair, acknowledged Nygaard-Andersen’s role in steering the company through turbulent times, particularly the resolution of the bribery investigation.
However, criticism surfaced over Entain’s costly acquisitions under Nygaard-Andersen’s leadership, tallying over $2.5 billion (£2 billion) in spending across 11 acquisitions.
The news of Nygaard-Andersen’s exit was welcomed by some investors, expressing the need for new leadership to recalibrate the company’s value. The company’s interim chief, Stella David, previously associated with Gibson through directorial roles in various firms, will now navigate the transitional phase.
Analysts foresee a meticulous search for a permanent CEO, with internal candidates like Rob Wood, Entain’s finance chief, considered for the role. Eminence Capital, Sachem Head Capital Management, and Dendur Capital are pressing for multiple board seats, putting pressure on Gibson amid an upcoming board reshuffle.
Original article: https://www.yogonet.com/international/noticias/2023/12/13/70055-entain-faces-leadership-shakeup-as-ceo-jette-nygaardandersen-steps-down-amid-investor-pressure
