Virtual Gaming Worlds (**VGW**) founder **Laurance Escalante** is poised to take complete ownership of the company following a decisive shareholder vote in favor of his proposal to acquire the 30% of shares he doesn’t already own. This values the company at **A$3.2 billion** ($2.1 billion).
The acceptance of this proposal means Escalante can transition the company into a private enterprise, a move he believes will better equip VGW to manage various challenges, including regulatory concerns in the US.
During the shareholder meeting on August 1, a substantial 85.04% of present shareholders (**91.31% of all minority shareholders**) supported the founder’s bid at A$5.05 per share.
The deal now awaits confirmation from the courts, expected by August 5. Following approval, the arrangement will be effective from August 6, with the completion scheduled for **August 20**.
Should everything proceed smoothly, Escalante will execute the buyout through **Ocean BidCo Limited**, a specially formed entity in **Guernsey**. Minority shareholders have the choice to receive cash, shares in Ocean BidCo, or a mix of both.
### The End of a Turbulent Relationship
This full acquisition by Escalante concludes what has been a prolonged and tense period with minority shareholders.
Recent months have seen increasing discord, highlighted by a heated exchange where Escalante aggressively suggested disenchanted investors should sell their stake if they doubted his leadership.
This confrontation followed mounting concerns among shareholders about undervaluation, lack of transparency in governance, and VGW’s handling of regulatory issues in the US.
Another point of contention arose from Escalante’s interest in the social gaming platform **Kickr Games**, which some shareholders argue directly competes with VGW’s own brands, leading to potential conflicts of interest.
However, the offering price of A$5.05 per share by Escalante aligns with valuations by **Kroll Australia**, which estimated the company’s worth between A$4.53 – 5.63 per share.
This offer also significantly surpasses the initial bid of A$3.50 – $4 per share made in November 2024, which was declined by an **Independent Board Committee** set up by the VGW board.
### Escalante Claims Going Private Will Boost Growth
Escalante is convinced that transitioning VGW to a private company will permit greater operational flexibility and reduce the distractions associated with shareholder expectations.
Registering Ocean BidCo in Guernsey, known for its tax benefits, enables VGW to avoid filing **Australian financial reports**. These tax and regulatory benefits are expected to enhance cost efficiency.
Despite these changes, Escalante has affirmed his commitment to maintaining an Australian tax-paying entity and staying domiciled in Australia.
VGW has displayed **strong results** in recent fiscal periods. In FY2024 (ending June 2024), VGW reported A$6.1 billion in revenue, marking a 27% increase YoY, with a net profit of A$491.6 million, up 33% YoY. This followed a 40% revenue increase in fiscal 2023.
Looking ahead, the company anticipates FY2025 profits to range between A$555–570 million, an improvement from the prior year, notwithstanding expected profit decreases due to withdrawals from several US states.
### Could Going Private Mitigate US Regulatory Challenges?
VGW has seen notable growth but faces increasing challenges in the US, a key market. The company’s dual-currency sweepstakes model is encountering legislative and regulatory difficulties, prompting exits from states like **Mississippi** and **New Jersey**, with the total now at 11 states.
Within the past year, VGW withdrew from **Connecticut** and **Delaware**, and legislative changes in **New York** and **Nevada**, along with regulatory actions in **Louisiana**, have pressured the company further.