Less than a week after being slapped with insider trading charges, Amaya CEO David Baazov is taking an indefinite leave of absence from the company, so says a statement from Amaya Tuesday morning. While the reason Amaya leads with for Baazov’s break is “to focus on preparing an offer to acquire Amaya,” it follows with the reason everybody knows is the real truth: he has to gird his loins for the upcoming legal hell storm.
Rafi Ashkenazi, a holdover from Rational before Amaya purchased the company and PokerStars, will take over as interim CEO. He’s in an interesting position, caught between two ownership groups: the Scheinbergs who used to own Stars and those who own the bulk of Amaya, including Baazov. Divyesh Gadhia, a member of the Board of Directors, is the Interim Chairman.
Quebec’s Autorité des marchés financiers (the “AMF”) charged Baazov and others with a variety of securities fraud-related charges including “aiding with trades while in possession of privileged information, influencing or attempting to influence the market price of the securities of Amaya inc., and communicating privileged information.”
The charges came after an investigation into a surprising run-up of Amaya’s stock preceding the announcement of its acquisition of PokerStars last June.
Here is the meat of the statement from Amaya:
Amaya Inc. (NASDAQ: AYA; TSX: AYA) today announced that Chairman and Chief Executive Officer, David Baazov, is taking an indefinite paid leave of absence from the company, effective yesterday. Mr. Baazov is taking this leave voluntarily to focus on preparing an offer to acquire Amaya and to avoid a distraction for the company while he responds to certain allegations made against him by the Autorité des marchés financiers (AMF), the securities regulatory authority in Quebec. Mr. Baazov will remain a member of Amaya’s board of directors.
The Board has appointed Divyesh (Dave) Gadhia as Interim Chairman, and Rafi Ashkenazi as Interim CEO. Mr. Gadhia has been an Amaya director since 2010, is the Board’s Lead Independent Director and is Chair of the Special Committee of independent directors established on February 1, 2016 to consider any proposal that may be made by Mr. Baazov, as well as other alternatives that may become available to Amaya. Previously, Mr. Gadhia served as the Chief Executive Officer and Executive Vice Chairman of Gateway Casinos & Entertainment Limited from 1992 until 2010, where he was responsible for strategic initiatives, regulatory matters and governmental relations.
Mr. Ashkenazi is currently CEO of the Rational Group, Amaya’s operating business, which includes the PokerStars and Full Tilt brands. Prior to becoming CEO of Rational Group in late-2015, Mr. Ashkenazi, an experienced gaming industry executive, served as Senior Vice President of Strategy for Amaya during 2015 and as Chief Operating Officer of Rational Group from January 2013 until early 2015, responsible for all customer-facing product and back-office functions for PokerStars and Full Tilt, including marketing, customer support, poker room management, IT management, payment processing and security, and game integrity. Prior to joining the Rational Group, Mr. Ashkenazi was Chief Operating Officer of Playtech, a global gaming software company.
Baazov said in the press release, “As always, I continue to be dedicated to doing the right thing for Amaya and all its stakeholders. I believe that stepping down in the short term will help to avoid distraction for the company and its management while I vigorously contest all allegations made against me and pursue my bid to acquire the company.”
