Aristocrat denies WMS rumor

Jun 24, 2003 6:41 AM

While the Australian slot machine manufacturer looks to straighten out both its business outlook and its internal management problems, Aristocrat Leisure Ltd. may become the target of a takeover bid.

There were suggestions last week that the company was being shopped to WMS Industries Inc. (WMS). These reports were strongly denied by Len Ainsworth, the founder of the company and whose family owns about 40% of the outstanding shares of Aristocrat. It was his son, Geoffrey Ainsworth, who reportedly was responsible for the initial WMS rumor.

Denying the report, Len Ainsworth noted that if his family "sold they would be up for tax on what they have got and up to 50% of whatever was left for dear old dad”¦They are not about to bale out unless there was some phenomenal figure offered. There is no incentive for them to sell," he told Australian news sources.

However, that doesn’t stop the controversial Len Ainsworth from speculating about an insider’s takeover. Last week, he told newsmen that he might consider a reverse takeover because "slack management and slack directors in particular" were to blame for Aristocrat’s situation.

Ainsworth, who founded the competing Ainsworth Game Technology a few months ago, said he might consider acquiring his old company and "incorporating it into my own rather smaller company."

Meanwhile, Des Randall, who headed the company until he was ousted two months ago, is being evicted from a $4.1 million home owned by Aristocrat. While Randall was in Las Vegas last week tidying up personal business, an Australian court ordered him to move out of the home within the next six weeks.

Still undetermined, however, is Randall’s termination payout that could run as high as $15 million Australian.