Blood In The Betfair Boardroom?
Published: Sunday, October 16, 2005 Online-Casinos.com
BLOOD IN THE BOARDROOM?
Hill "abruptly" departs Betfair
The Times and other UK business media were marking the sudden departure of Betfair
CEO Stephen Hill from the betting exchange group on Friday following the
companys decision to postpone its plans for a GBP 1 billion flotation.
Hill, a former chief executive of the Financial Times Group, left "abruptly"
according to the reports. His duties have been assumed by Sir Robert Horton,
the former Railtrack boss, who became non-executive chairman in March last year
ahead of a possible initial public offering.
The company said that Mr Hill had decided to leave after a board meeting at which
it had been confirmed that the company had “no plans to float in the immediate
future”.
The report says a source close to the betting firm revealed that Mr Hill had wanted
to press ahead with an IPO in the first quarter of 2006, whereas the rest of the
board had decided that there was “no good reason” to do so.
Analysts are suggesting that the reason is likely to have been the recent decline
in sentiment towards online gambling stocks after PartyGaming’s warning of
slowing growth prospects.
The biggest shareholders in Betfair are Andrew Black and Edward Wray, its founders,
who between them have almost 30 per cent. Europeatweb, an internet-based fund
controlled by Bernard Arnault, the LVMH boss, has about 10 per cent.
Betfair said that Mr Hill had left to pursue plans for a new venture that would
invest in small and medium-sized companies, focusing on turnaround situations.
He is expected to get a payout equivalent to half his GBP 325,000 salary, and
it is believed that he will retain the 3.13 million shares that are held in an
employee benefit trust in his name.
The shares are technically owned by him already and he is expected to retain them
until he can crystallise the value after an IPO. They would be worth more than
GBP 20 million if Betfair were to attract a GBP 1 billion valuation as has been
estimated.
A former colleague at the FT, Charles Pretzlik, the newspaper’s UK Companies
Editor, said: “I think it is fair to say (Mr Hill) is not one of those people
who necessarily makes friends wherever he goes.”
