License article

Len Ainsworth cashes out $473m pokies stake

Billionaire pokies king Len Ainsworth will donate "a large chunk" of a $473 million windfall to charity, after he sold his 53 per cent stake in the company he founded, Ainsworth Game Technology, to Austrian gaming company Novomatic.

The 92-year-old gaming veteran will retain his role as chairman, with Novomatic saying it expects to keep its stake in the company at about 53 per cent and retain Ainsworth's ASX listing.

Mr Ainsworth told Fairfax Media he expected to build on his previous philanthropic work by handing some of the money to health research, while also sharing part of the windfall with his family.

"I take the view I've been lucky in life and I should share my luck with my family," Mr Ainsworth said on Tuesday. "I think medicine and universities would be the target. If you can find a cure to something, that is a big prize in itself."

Mr Ainsworth has given away more than $30 million to medical research, including a donation to the redevelopment of Sydney's St Vincent's Private Hospital.

He said the move was partly inspired by his wish that the company that bears his name will still be "alive and kicking" in 40 years.


"It gives all the staff a guarantee the company will be there for the future," he said. "I'm ambitious, of course, but I probably have 10 years rather than 40 years left on this planet."

The pokies entrepreneur's family wealth was estimated at $1.82 billion in the BRW 2015 Rich List. In the 1990s he handed his family a lucrative stake in Aristocrat Leisure, which Mr Ainsworth founded, upon discovering he had been diagnosed with prostate cancer.

Second pokies empire

The diagnosis famously proved false and Mr Ainsworth went on to create his second pokies empire, Ainsworth Game Technology, which competes head to head with Aristocrat for pokie machine sales to casinos, pubs and clubs.

Mr Ainsworth sold 172.1 million shares at $2.75 a share, netting the entrepreneur more than $470 million. The company's shares closed nearly 4 per cent higher at $2.12 on Tuesday.

Ainsworth Game Technology said it supported the deal and would convene an emergency meeting for shareholders to vote on the transaction.

However, Watermark Funds Management, a shareholder in Ainsworth, said it was suspicious of Novomatic's motives in holding a controlling stake without launching a takeover.

"It looks suspicious that Novomatic want to control Ainsworth but not own 100 per cent," Watermark investment analyst Joshua Ross said. "The current offer does not make sense for minority shareholders – it looks to be to their detriment. Novomatic will gain from access to the US, however, the prospect of a takeover from a third party are diminished, and Novomatic is not necessarily aligned with minority shareholders."

The share sale was disclosed in Ainsworth's results, with its profit after tax in the first half of 2016 falling 4 per cent to $33.1 million, although stripping out currency gains the company boosted its net profit 7 per cent to $26.1 million.