What was quietly announced as additional funding for World Gaming Plc will ultimately lead to the reorganization of a company in search of long-term stability as a leader in the interactive gaming industry.
On Monday, the U.K.-based gaming software supplier said that Goodison Park Ltd acquired an interest in the company through share acquisition and a convertible loan.
Today it was made public that Goodison Park is a subsidiary of Sportingbet Plc, World Gaming's biggest licensee.
Sportingbet Plc, also based in England, said its investment in World Gaming should make World Gaming an independent entity with a leading package of gaming software.
The exact details of the deal weren't disclosed, but World Gaming said the company would be able to fund its capital requirements and new product development costs to accelerate growth.
In conjunction with the infusion of capital, World Gaming's Nicholas Jackson submitted his resignation as a member of the board of directors and as chief executive officer with immediate effect.
Sportingbet will help reshape the board of directors, which currently stands at only two positions. One of those positions is held by a representative of Goodison. World Gaming said the new board will be appointed within a week.
Speculation that the move was laying the foundation for Sportingbet to take full control over its supplier was put to rest by a Sportingbet executive, who asked not to be named.
"It would be in our interest for World Gaming to remain an independent supplier," he said. "This is more for us to ensure that there is quality management in place at World Gaming."
World Gaming, formerly Starnet Communications, has a very checkered past. In 1998,Royal Canadian Mounted Police, while investigating possible Internet gambling and pornography charges, swept through the company's offices, hauling off computers and documents. News of the raid sent the company into a downward spiral. A few years after the raid,the company pled guilty to a handful of gambling and betting charges and forced to forfeit $3.9 million from the $7.6 million in funds that were frozen when the raid took place.
The company has also gone through a myriad of CEOs during the last two years. Jackson, part of a management team that took over the company in 2002, said that with the long-term financial stability of the company secured, it was time to step aside.
"After having given a number of years' service to World Gaming, I am pleased to be departing having secured new investment for World Gaming and insured its future prosperity," he said.
Jackson said he wasn't at liberty to disclose that Goodison was a subsidiary of Sportingbet when the announcement was made earlier in the week due to various rules and regulations of the financial markets on which the company is traded.
Goodison Park Limited has identified online gaming as an investment with excellent growth potential and indicated to World Gaming’s board of directors that additional funds are available to finance advancements in the future.
"Goodison Park Limited's investment may well prove to be a watershed in the Company's history," Jackson said. "World Gaming plc can look forward to the future with increased confidence . . . Goodison Park Limited's investment is extremely good news for World Gaming and its shareholders."
The new board's first order of business will be selecting a new CEO.