Youbet Focus of Potential Takeover?
by Ryan Conley
Date Posted: 10/13/2008 2:02:09 PM
Last Updated: 10/15/2008 9:12:38 AM
A public equity investment firm managed by the president and chief executive officer of Youbet.com is considering several options for the online wagering and tote company, including a potential takeover, according to a recent filing with the Securities and Exchange Commission.
New World Opportunity Partners I, which lists as its managing member Youbet executive Michael Brodsky, said it was contemplating an offer to “acquire all of the shares of the issuer,” as one of several options it is mulling over for the advance deposit wagering company. New World declared a 12.8% stock stake in Youbet in the document, which was filed online Oct. 10 after the close of the stock market.
Youbet officials declined requests for comment made through a New York investors’ relations firm.
New World in part said it made the disclosure “in light of recent financial industry developments, extreme volatility in the equity markets, stagnant credit markets, increasing costs related to (Youbet’s) status as (a) public company … and weak economic conditions generally,” the filing said.
The document also said it could possibly extend credit to Youbet or invest directly into the company, although it said it has not decided on any course of action.
Brodsky, who was named to his current Youbet positions in April, has been the managing partner of New World since June 2005, according to Youbet's Web site. He previously served as an executive with some online travel operations, including a subsidiary of Orbitz.com. Brodsky, who joined Youbet’s board of directors in 2007, was Youbet’s chairman from February to April, a title now held by Hollywood Park president Jack Liebau.
Also signing the SEC disclosure was J.B. Pritzker, a Youbet director who, with an estimated net worth of $2.2 billion, is ranked 205th on the Forbes list of “The 400 Richest Americans.” Pritzker is managing partner of The Pritzker Group, a private investment firm, and chief executive officer of AmSafe Partners, a provider of aviation passenger and cargo restraints.
Youbet in August said it was continuing to streamline operations and would consider the prospect of acquiring horse racing network TVG, with which the company has various contractual agreements.
The parent company of TVG, Macrovision Solutions Corp. earlier this year said it would attempt to sell the horse racing channel and a few other properties it acquired in April from Gemstar/TV Guide International in a $2.8-billion deal. Recent published reports suggest the original $112-million value placed by Macrovision on TVG has decreased substantially due in part to the world-wide financial fallout.
Youbet’s stock price was up 7.1% to $1.20 in morning trading Oct. 13. Shares closed Oct. 10 at $1.12, a decline of 10.4% on a volume of 1,129,200, a tally more than 10 times the daily average.
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