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Read Full BioVGW founder Laurence Escalante’s push to gain full control of the company has reignited investor tensions, as shareholders have questioned his involvement in social gaming platform Kickr Games, which they claim directly competes with VGW’s brands.
According to the Australian Financial Review, shareholders have been frustrated with the founder’s divided focus and potential conflict of interest. They claim Kickr could undermine the value and future of VGW, which Escalante wants to take private by purchasing the 30% of the company he doesn’t already own.
Kickr Games was founded in 2023 as a social sportsbook. However, it has also evolved into a sweepstakes casino. That means it operates in the same sector as VGW’s brands, which include Chumba Casino, LuckyLand Slots, and Global Poker.
Importantly, VGW does not own Kickr Games. Instead, Lance East Office, Escalante’s family office, owns the platform.
Through this entity, the VGW founder is seeking to acquire the remaining shares of the company. He has proposed A$5.05 per share ($3.29) in cash payout, shares in Ocean BidCo (a special purpose vehicle), or a combination of the two.
The bid represents an improvement from the initial one made in November 2024, when Escalante offered A$3.50 ($2.28) to A$4.00 ($2.58) per share.
Shareholders will discuss Escalante’s offer on August 1. If they agree, the sale will be completed by September 15.
Conflict of Interest Fears
Minority shareholders have expressed fears that Kickr creates a serious conflict of interest. The worry is that Escalante could siphon VGW resources and talent to Kickr during a critical time.
The timing of Kickr entering the sweepstakes casino space, launching as the founder is pushing to gain complete control of VGW, has raised suspicions that the proposed takeover price undervalues the company.
Additionally, as VGW faces growing regulatory challenges and exits from key US states, shareholders worry that Escalante’s divided attention could weaken the company’s growth and its effectiveness in navigating these headwinds.
Investors also fear that future strategic decisions may prioritize Escalante’s private interests, potentially sidelining minority stakeholders and capturing future value growth outside of VGW.
VGW has rejected these concerns. In a statement to the Financial Review, the company said:
“This is a business … that is completely separate from VGW, which has had no involvement with it whatsoever. It has no impact on VGW or its operations, and VGW does not view it as a competitor.”
Escalante’s History of Shareholder Tensions
The friction between Escalante and shareholders is nothing new. As the CEO and majority shareholder, Escalante has maintained control of the company; however, he has often clashed with investors.
That includes his profanity-laced tirade at investors a few months ago, where he told them to sell their shares if they did not trust his leadership.
The most common argument of minority shareholders is that the company is undervalued, and they have pushed for higher valuations and more liquid options. These concerns are surfacing again, with fears of competition from Kickr.
Other shareholder gripes include VGW’s response to US regulatory pressures, as well as a lack of transparency in corporate governance.
Escalante’s push to take VGW private could resolve some of the tensions. The latest offer is significantly higher than the initial one, addressing the concerns about undervaluation.
Can Privatization Shield VGW’s Growth?
Escalante argues that taking the company private will help VGW navigate through regulatory scrutiny and continue its growth.
VGW has enjoyed steady revenue and profit increases over the past few years. For its 2024 Fiscal Year ending on June 30, 2024, the company reported A$6.1 billion ($4 billion) in revenue, a 27% year-over-year growth. The net profit in 2024 was A$491.6 million ($321.6 million), representing a 33% year-over-year increase.
Meanwhile, in 2023, the company’s A$4.84 billion ($3.16 billion) revenue represented a 40% increase from 2022.
According to the VGW Scheme Booklet regarding the potential sale, the first half of the current financial year was also successful.
Through the six months ending December 31, 2024, VGW has generated A$3.5 billion ($2.3 billion) in revenue, with A$298.8 million ($195.5 million) in net profit. If the second half, which ended on June 30, 2025, is as successful, the company could break the A$7 billion milestone in revenue.
However, the growth trajectory is under threat, as VGW has exited several US jurisdictions in the last few months. While it was technically included in the first-half report, the company’s exit from Connecticut was at the end of that period.
Additionally, in 2025, VGW has also left New York, one of the largest markets, as well as Delaware and Nevada. Regulators have also targeted the company in Maryland, Louisiana, and Mississippi.
Moreover, New Jersey has voted to ban sweepstakes casinos, while California is currently debating the issue.
