Scientific Games files a lawsuit against its third-biggest shareholder Sylebra Holdings
June 20, 2019
Scientific Games could soon file a lawsuit against its third-biggest shareholder, Sylebra Holdings, which has a 9.34 percent stake in the company with a grand total of $177.8 million invested in this company. The supplier went on to say that Sylebra is being investigated by 24 US and international gaming authorities. They work out of Hong Kong, and when they were asked to comply with information requests and disclosure submissions to the right regulatory body, they refused.
What Does the Lawsuit Allege
Along with the things previously mentioned, the lawsuit also alleges that Sylebra Holdings has alleged ties with a Russian company that has done a variety of criminal activities such as money laundering, illegal gambling and the financial support of terroristic organizations. Susan Cartright, the spokeswoman for Scientific Games, has said that her company takes transparency and the high standards of gaming extraordinarily seriously. They want the regulators in Nevada to know that they remain compliant, and they are not aligned with some of the alleged activities that Sylebra Holdings potentially does. In fact, whether they work in the United States or anywhere else in the world, they want to remain compliant with the correct coming commissions.
Sylebra Holdings owns 8.6 million shares of the company, and they have held this company for over four years.
What is Sylebra Trying to Hide?
Susan Cartright has said that the fact that Sylebra Holdings has allegedly attempted to hide its activities shows that it could be hiding some shady activities under the surface. In addition, because of its alleged ties with a Russian company known for these activities, it could go against them. The identities of the investors in this master fund have never been fully disclosed. However, Sylebra Holdings has a sustained pattern of strategically timing their disclosure of information that they are willing to part with. They use procedural mechanisms in an effort to prevent disclosing any information that actually matters.
What does Scientific Games hope to get from this lawsuit? In the lawsuit, they hope to get all the necessary information. Let's say that Sylebra Holdings chooses to fight this. Scientific Games could see them as a disqualified shareholder based on the corporate bylaws. Ultimately, this would force Sylebra Holdings to sell its shares. At Scientific Games, the largest shareholder in the company is American billionaire Ron Perelman who holds a 39.2 percent stake in Scientific Games.