Gambling group Entain’s chief steps down

Unlock the Editor’s Digest for free

Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.

Entain’s chief executive Jette Nygaard-Andersen has stepped down with immediate effect after coming under fire from investors for a languishing share price and a series of costly acquisitions.

The Ladbrokes owner said on Wednesday that Nygaard-Andersen, who had only held the top job since 2021, would be replaced on an interim basis by non-executive director Stella David.

The announcement of Nygaard-Andersen’s departure follows Financial Times reports in recent weeks that Entain had three US activist funds among its top-20 shareholders and there was internal unrest at the UK bookmaker over the Danish executive’s management of the company.

Over the past two years, Entain has ranked as the fourth worst performer on the FTSE 100 for total shareholder returns after the board walked away from two takeover bids from US gambling operators MGM Resorts International and DraftKings that valued the bookmaker at a premium to the current share price.

Entain, which owns the Ladbrokes and Coral brands, said Nygaard-Andersen had told the board of her decision to quit. Entain’s chair Barry Gibson who promoted Nygaard-Andersen to chief executive from a non-executive director role when her predecessor quit unexpectedly three years ago, said the company was “indebted to Jette for her dedication to steering the company through such a difficult time”.

But under Nygaard-Andersen’s leadership, Entain spent more than £2bn on 11 bolt-on acquisitions, several of which have since been closed, leading to criticism from investors for a costly mergers and acquisition strategy.

The bookmaker has also broken from its corporate cost discipline. Corporate costs almost doubled between 2019 and 2022 to £91mn.

During the pandemic Nygaard-Andersen and Gibson began using private jets to travel to board meetings in Gibraltar. As the pandemic receded Nygaard-Andersen continued to use private aircraft, something rarely done under previous management, the FT reported last week.

Nygaard-Andersen on several occasions used a private jet to visit the US, according to three company insiders. Some staff within the finance and audit teams have nicknamed her “Private Jette”.

Gibson praised Nygaard-Andersen for her handling of the HM Revenue & Customs bribery probe into Entain’s former Turkish subsidiary, which concluded last week with the UK bookmaker agreeing to pay £585mn to UK authorities as part of a deferred prosecution agreement, the second largest penalty of its kind since the DPA scheme began in 2014.

Nygaard-Andersen said on Wednesday that Entain was “now safe, stable and sustainable and I believe that this is the right time to move on to other business and career opportunities”.

The news of her exit was welcomed by Entain’s investor base. “After a difficult period, it is time for an executive leadership at Entain that can get us back to a truer reflection of the fair value of the business,” said Wes McCoy, investment director at Abrdn, a top-five shareholder in Entain. “We will welcome anyone who can help shareholders do that.”

Interim chief David is a longtime associate of Gibson, having served on the board of UK home repairs and emergency services group HomeServe when Gibson was chair. She previously ran UK spirits and liqueurs business William Grant & Sons, as well as shoe brand Clarks on an interim basis.

Analysts at Jefferies noted that they expected a “rigorous process” to find Nygaard-Andersen’s permanent replacement, after the two previous chief executives were internal candidates. Rob Wood, Entain’s finance chief, is a possible candidate for the top job, they added.

Shares in Entain rose 5 per cent in morning trading on Wednesday, but the stock remains down 40 per cent since the start of August.

Gibson is under growing pressure from the New York-based activist funds Eminence Capital, Sachem Head Capital Management and Dendur Capital to grant them multiple board seats under an upcoming board refresh.

Additional reporting by Maxine Kelly in London