An Independent Expert tasked with assessing a plan by European gaming giant Novomatic to assume full control of Australian supplier Ainsworth Game Technology (AGT) has described the scheme as “fair and reasonable”.
Despite vocal opposition by a smaller shareholder block, Lonergan Edwards & Associates Limited stated in a report released Friday that the scheme is “fair and reasonable and therefore in the best interests of Scheme Shareholders in the absence of a superior proposal” because the consideration to be paid to shareholders lies within its assessed valuation range.
Novomatic, which currently owns a majority 52.9% stake in AGT, will pay shareholders AU$1.00 per share to acquire the 47.1% interest it does not already hold should the plan receive all necessary approvals. The deal is valued at AU$158.6 million (US$104.3 million).
The Independent Expert said it values AGT shares in the range of AU$0.93 to AU$1.07 per share.
Outlining the advantages of proceeding with Novomatic’s proposal, the Independent Export added that the offer also represents a significant premium to the recent market prices of Ainsworth shares prior to the announcement of the scheme on 28 April 2025 and is consistent with observed premiums generally paid to target company shareholders in comparable circumstances.
“If the Scheme does not proceed, and in the absence of an alternative offer or proposal, the price of Ainsworth shares is likely to trade at a significant discount to our valuation and the Scheme Consideration due to the difference between the value of Ainsworth shares on a minority interest or portfolio basis and their value on a 100% controlling interest (takeover) basis,” it said.
Disadvantages would, the Independent Expert said, include no longer holding any interest in Ainsworth and therefore being unable to participate in any future value created by the company.
“However, as the Scheme Consideration lies within our assessed value range of Ainsworth shares, in our opinion, the present value of Ainsworth’s future potential is reflected in the Scheme Consideration,” it wrote.
“Given the above analysis, we consider the advantages of the Scheme to outweigh the disadvantages. Accordingly, in our opinion, the acquisition of Ainsworth shares under the Scheme is fair and reasonable and therefore in the best interests of Scheme Shareholders, in the absence of a superior proposal.”
Kjerulf Ainsworth, the second-largest shareholder of Ainsworth Game Technology (AGT) and son of company founder Len Ainsworth, had recently accused the company of undervaluing property assets in its bid to privatize while outlining his belief that AGT shares should be worth closer to AU$3 per share.
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