Founders Selling PartyGaming Shares.
The four founders of the world's largest online gambling company are this morning selling a significant chunk of their stakes in the firm. Dresdner Kleinwort Wasserstein is understood to be placing 8.75% of PartyGaming, worth around £450 million ($840 million), on behalf of the founders. It brings the free float of the company's shares up from 28% to 35%.The four founders include the billionaire and chief operations officer of the company Anurag Dikshit, marketing director and member of India's 40 Richest people Vikrant Bhargavar, Ruth Parasol, who first commissioned Dikshit in 1998 to write the software for what would become their hugely successful Web site PartyPoker.com, and her husband Russell DeLeon. Fellow shareholder Nitin Jain is also selling a stake.
Spawned in 1997, when Dikshit (pronounced Dixit) and Bhargavar were fresh out of Indian Institute of Technology, PartyGaming today handles nearly half the global online poker market. Touting a market capitalization of over $8 billion, PartyGaming was floated on the London Stock Exchange on June 30, 2005, netting Dikshit $785.8 million and Bhargava $114.8 million.
The founders were previously said to be "locked in" to their holding until June 30 of this year, but a source tells us Dresdner Kleinwort Wasserstein has been able to "work around" the restriction so that the stake can be sold today. The founders had been expected to offload their stakes since the end of May, when PartyGaming announced that Dikshit and Bhargavar would be stepping down from the board. The pair's overall holding of 30.4% and 8.6% respectively, is worth $3.73 billion. The founders will have to keep a majority holding of the company until 2010 in order to keep their headquarters in tax-friendly Gibraltar.
Institutional investors are said to be concerned that a dumping of the founders' shares will pull down on PartyGaming's share price. Even if the stakes are dribbled out over time, it's feared the market might still not look too kindly on the firm. PartyGaming shares were down 6.6 pence to 115.75 pence in London morning trading.