News · Corporate governance
Ainsworth records order puts Novomatic buyout back in focus
Reported access to company records gives Kjerulf Ainsworth another route to examine the failed buyout. For the industry, the dispute raises questions about valuation, minority ownership and the cost of unresolved governance concerns.
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Kjerulf Ainsworth has secured permission to inspect certain internal records of Ainsworth Game Technology, according to a report published by Inside Asian Gaming on 14 November, extending the dispute surrounding Novomatic's attempt to take full ownership of the Australian gaming supplier.
IAG reports that the Federal Court order was made by consent and allows the shareholder to investigate whether to bring further proceedings. It does not establish wrongdoing by the company, Novomatic or any individual.
The development matters because the takeover process left Novomatic with stronger control while other investors remained shareholders. Questions about the information supporting the proposed exit price have therefore outlived the offer itself.
What the reported order changes
According to IAG, the inspection concerns matters including property valuations, transactions with Novomatic, dividend decisions and potential conflicts of interest. The reported document categories include valuations of Ainsworth's Nevada and Florida properties and material relating to the takeover's independent expert reports.
These are subjects for investigation. Neither the existence of a valuation dispute nor access to related-party records establishes that an asset was misstated or a transaction improper.
Our view is that the commercial importance lies in the opportunity to test the decision-making record. Documents may support the explanations already given, reveal matters requiring further answers, or narrow the disagreement. Their significance depends on what they show, rather than the breadth of the questions a shareholder wishes to ask.
How the A$1 offer left a listed minority
The central transaction began on 28 April 2025, when Ainsworth announced a scheme agreement under which Novomatic proposed to acquire the shares it did not already own for A$1 each. Novomatic already held approximately 52.9%.
Novomatic announced an alternative unconditional off-market takeover offer on 20 August 2025, initially running alongside the scheme at the same price. That route increased its ownership without delivering a complete buyout.
The buyer presented its offer as providing certainty for shareholders concerned about liquidity and future performance. It also pointed to a 35% premium to the closing price before the original proposal. That explains the case Novomatic made for its terms, without settling the disagreement over value.
The chronology requires care:
| Date | Confirmed position |
|---|---|
| 28 April 2025 | The proposed scheme was announced at A$1 per share. |
| 3 September 2025 | Novomatic's subsequent takeover offer opened. |
| 6 February 2026 | The offer closed with Novomatic's voting power at 66.84%. |
| 11 February 2026 | Ainsworth terminated the transaction implementation deed; the shareholder schedule for that date showed Novomatic at 67.39%. |
The final two percentages describe different dates, rather than interchangeable measures of the bid's closing result. Both appear in the company's disclosures.
Control and compulsory acquisition are also different questions. The September 2025 target's statement described a compulsory acquisition route requiring at least 90% of all shares alongside an additional test concerning the shares covered by the offer. A controlling majority alone did not deliver ownership of the remainder.
Why A$1.30 was not a full competing buyout
Kjerulf Ainsworth challenged the transaction with proportional offers of his own.
The initial proposal, announced in October 2025 and documented in the December target's statement, offered A$1.30 for 2.9% of each shareholder's holding. A later offer, addressed in an April 2026 target's statement, generally covered 5.5% at the same price. Special provisions applied to small, unmarketable parcels.
The higher price was significant, but its scope was limited. For an ordinary holding, selling a fraction at A$1.30 did not provide an exit for the entire investment at that price. It also left the shareholder exposed to the value and liquidity of the balance.
This distinction between headline price and executable terms also runs through our recent analysis of DoubleDown's takeover. The transactions differ, but in each case the structure determines what shareholders can actually sell.
The independent valuation belongs in the account
Any fair assessment must acknowledge the expert opinion supporting Novomatic's offer.
In the September 2025 target's statement, Lonergan Edwards & Associates assessed Ainsworth at A$0.93 to A$1.07 per share on a controlling interest basis. It considered the A$1 offer fair and reasonable in the absence of a superior proposal.
That was a dated valuation opinion, not a current share-price quotation or a judicial finding. Equally, a shareholder's disagreement does not invalidate it.
The useful questions concern the assumptions and information behind the assessment: the earnings outlook, treatment of property and relationship between assets and future cash generation. Those matters can be examined without assuming the expert reached the wrong answer.
Our judgement is that the process for assessing a buyout by a controlling shareholder should allow investors to understand why the recommended price is defensible. An independent report is central to that explanation, and confidence in its inputs matters as much as the final range.
The dispute sits inside an operating business
Governance concerns have already coincided with leadership changes. On 5 June 2026, Ainsworth announced the immediate resignations of chair Danny Gladstone and company secretary Mark Ludski, following media reports about historical personal payments. The company appointed Graeme Campbell as chair.
Those changes should not be presented as consequences of the newly reported records order, which came months later. Changing personnel also does not, by itself, answer questions about earlier decisions.
Meanwhile, the company has a demanding commercial task. Its results for the six months ended 30 June 2026 showed revenue of A$116.5 million, down 23% year on year, and underlying profit before tax of A$4.7 million, compared with A$13.9 million a year earlier. These are underlying pretax figures, distinct from statutory net profit.
In the August results announcement, chief executive Ryan Comstock acknowledged weaknesses in recent North American product offerings and set out priorities covering new games, research and development, cost management and cash flow.
That makes the opportunity cost of prolonged disagreement important. A prolonged dispute can absorb management time and resources that a supplier also needs for product development and customer relationships. The cost of this inspection exercise has not been quantified in the disclosures reviewed.
The interests of controlling and minority shareholders can overlap here. Both benefit from a stronger operating business; both have an interest in decisions that can withstand scrutiny.
What the next stage needs to establish
The immediate question is what inspection produces and whether it leads to further proceedings, additional explanations or a narrower dispute.
It would be premature to predict compensation, a higher takeover offer, delisting or a finding against any participant. None follows automatically from access to records.
For the gambling industry, the wider lesson is that gaining a larger majority does not necessarily settle a contested transaction. Investors who remain need confidence in valuation, capital allocation and the handling of relationships with the controller.
Our view is that Ainsworth's next meaningful milestone will be evidence that resolves specific questions. A consent order opens access to information; the company's governance will be judged on the substance that follows.