Playtech seller before alert

By Ruth David and William Canny

An unidentified investor sold a stake worth approximately €136m in Playtech about two weeks before the UK gambling and financial software company reported a profit warning that sent the stock tumbling, sources said.

Goldman Sachs’ trading desk began to market the stake on June 14, and the seller was a US hedge fund, according to sources.

A June 19 filing showed that Morgan Stanley had reduced its stake in Playtech from 5% to below 3%. Morgan Stanley held the shares on behalf of an investor, sources said.

Playtech, backed by billionaire Teddy Sagi, announced a profit warning on July 2 citing competitive pressures in Asia, which sent its shares tumbling 26%. They are down more than 30% since the day before the announcement. The block of shares that changed hands in Playtech around the sale was about 14 million shares, or around 4%. The average daily volume traded in Playtech is around 1.6 million shares.

Playtech said in July that competitors in Asia were driving a “particularly aggressive pricing environment” which hurt revenue. “Given the recent decline and in the absence of any change in market dynamics, we expect a significant impact on revenue throughout the rest of the year,” it said. That impact could lower revenue from Asia by about €70m compared to original expectations.

The company’s management and others with access to material information are prevented by European regulations from selling shares for 30 days before interim or year-end financial reports. Other investors don’t have specific restrictions unless they’re in possession of insider knowledge. Playtech shares fell 5% at one stage in the latest session, valuing the firm at £1.64bn (€1.8bn).

- Bloomberg


More in this Section

Honda workers ‘devastated’ as UK car plant to shut putting 3,500 jobs at risk

Sterling little bruised as seven Labour MPs exit party

Providence sizing up west coast drilling campaigns

IHF Cork sees risk of too many hotel rooms


Lifestyle

Want to have a whale of a time? IWDG bringing Iceland expedition stories to libraries

Mature students should start on grant applications

Rosamund Pike’s battle to portray war reporter Marie Colvin

Other side of Gaza: Irish film-makers highlight ordinary lives in the besieged territory

More From The Irish Examiner