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Entain Climbs as Fourth New York Activist Fund Takes Stake in Ladbrokes Owner

Shares in Entain PLC were on the FTSE 100 leaderboard on Thursday after the Ladbrokes owner gained a fourth activist investor on its shareholder register.

A day after the bookmaker’s chief executive Jette Nygaard-Andersen resigned with immediate effect, New York-based Corvex Management put out a statement confirming it has built up a 4.4% stake and calling for “further change” as it described the group’s recent performance as unacceptable.

The hedge fund, which was founded by Keith Meister, a protégé of billionaire activist investor Carl Icahn, said it believes Entain is at a critical juncture.

It plans to undertake “constructive” and “helpful” engagement with chairman Barry Gibson and interim CEO Stella David and suggested it was suited to providing this as a “well-informed shareholder with substantial industry and company-specific experience and expertise”.

Corvex called Nygaard-Andersen’s departure “a necessary first step”, but called on the company to consider “all options … to drive value”.

Entain shares rose 7% to 907.6p, though they are still down half from pandemic peaks and recently sinking to a three-year low, Corvex is joining several other New York activist investors that have recently accumulated stakes.

These are Sachem Head Capital Management, Dendur Capital and Eminence Capital, according to reports.

Entain, which rebuffed down takeover offers from US casino giants MGM Resorts and rival DraftKings in 2021, has recently been dealing with legacy legal issues regarding its Turkey operations, leading to a near-£600 million settlement.

Touting itself as long‐term investor, Corvex says on its website that it specialises in “fundamental value‐based investing with the ability to become active in situations to create asymmetric risk/reward opportunities”, and that its “knowledge‐based approach to partnering with management teams, boards and other constituents help[s] create shareholder value”.

Source: Investing