PartyGaming Shares Fall 14% After Co-Founder Sells His Shares In CompanyOctober 20, 2009 11:25 am
Billionaire Indian businessman and co-founder of PartyGaming plc has sent the company’s share price tumbling after he announced he was selling his entire 27.63% stake in the company to concentrate on charitable work in south Asia.
Today Anurag Dikshit sold 75 million shares or two thirds of his holding in the company through Crystal Ventures Limited at a price of 250p in an ‘accelerated bookbuilt offering to institutional investors.’ Following the news PartyGaming shares fell 38.8p to 245.7p on the LSE giving the company a market value of 1.01 billion pounds ($1.7 billion).
PartyGaming was founded in 1997 by lawyer Ruth Parasol and Anurag Dikshit became involved in the company after the brilliant software developer wrote some proprietary code for the site to replace the software they were already licensing. Along with Parasol’s husband, who is a lawyer, and a fourth partner, Vikrant Bhargava, they started PartyPoker.com.
Dikshit became one of the richest men in the world after he sold 23% of his shares in the company during its initial flotation on the LSE in June 2005. In December 2008 Dikshit became caught up in the whole UIGEA storm hitting internet gambling state side and pleaded guilty to ‘online gambling’ contrary to the Federal Wire Act and agreed to forfeit $300 million.
Following the settlement with the US Justice Department, PartyGaming made its first tentative move back into the US market after the company purchased WPT Enterprise. David Jennings, Davy Stockbrokers analyst believes Anurag Dikshit’s decision to sell his holding could present new opportunities for the company :
“Under current U.S. law operators are unlikely to get licenses if any of their beneficial owners have criminal records. If they’re going to win a licence he is going to have to sell down his stake.”