LONDON (Reuters) - American activist investor Jason Ader on Monday claimed his proposals to shake-up online gambling company Bwin.Party by bolstering its board had won support from other shareholders in the firm.
Ader, whose asset management firm SpringOwl is Bwin.Party's fourth largest shareholder, said in April he wanted four new directors elected to the company's board to tackle what he describes as a continuing decline in the business.
Bwin.Party has urged shareholders to vote against the proposal, saying it would make the board too large and hamper decision making.
Ahead of its annual meeting on May 22, Ader said in a statement Bwin's board had "overseen significant shareholder value destruction" due to a failing strategy that has seen it underperform its rivals. Ader also criticized a "runaway cost structure" and its impact on the company's profitability.
"We have received incredible support from the Bwin.Party shareholders we have already spoken with and look forward to more conversations as shareholders have the opportunity to add sorely needed skills to the board of our company," Ader said.
He did not give details on the level of support SpringOwl had won.
Bwin was not immediately available for comment on Monday, which is a public holiday in the United Kingdom.
Ader has proposed that internet entrepreneur Michael Fertik, lawyer Francis Grady, venture capitalist Kalendu Patel and gaming industry expert Steven Rittvo be added to Bwin.Party's existing nine-strong board.
Activist investors push for change at firms they believe are undervalued and can provide better shareholder returns via a change in strategy or management. Ader, an ex-Wall Street gaming analyst, battled with U.S slot-machine maker International Game Technology last year, winning a board seat for his firm.
Ader has said the four new directors he proposes to be elected to Bwin.Party's board would provide significant expertise in online gaming, technology and U.S. banking systems.
Bwin.Party has said it does not have sufficient information or time to review the suitability of each candidate, and believed it would not be in the interest of the company and investors for a shareholder with a stake of 5.25 percent to nominate so many directors onto the board.
In March, the firm posted a 35 percent drop in full-year earnings to 108 million euros ($149.75 million) due to falling revenue, increased gaming taxes in Germany and start-up costs in New Jersey.
Reporting by Neil Maidment