On Thursday, Kindred Group plc announced the resignation of its CEO, Henrik Tjärnström, effective immediately. Nils Andén has been appointed as the interim CEO.
Tjärnström’s resignation comes just days after Kindred CFO Johan Wilsby announced that he will depart later this year. This leaves Kindred, one of the world’s leading online gambling and legal sports betting operators, in a precarious situation.
Departures belie numbers
In general, Wall Street gets anxious when top company officers resign, especially a CFO. Analysts interpret a CFO’s exit as a sign that a company’s financials aren’t up to par. But that doesn’t seem to be Kindred’s case.
The global online betting sites firm reported strong first quarter earnings. Kindred – the parent company of Unibet – grew revenue by more than 24% and earnings by roughly 300% in the first quarter compared to the same period last year. In fact, the earnings were so strong, that the company announced it is exploring a sale.
Activist resumes push for sale
Last month, Kindred’s Board of Directs announced they were initiating a “strategic review of alternatives.” The Board hired several financial advisors to orchestrate a merger or sale of the company. This isn’t the company’s first attempt at a sale.
Last year, Corvex Management — activist investor Keith Meister’s hedge fund — took a 10.12% stake in Kindred, later increasing it to 15%. The fund aggressively pushed for a sale last year. To assist in that goal, Corvex secured a seat on Kindred’s Board of Directors. While Kindred was unable to find a buyer last year, this year’s search may be more fruitful given its recent financial performance.
Kindred left in experienced hands
Kindred’s top officers may be leaving due to the Board’s renewed efforts to sell the company. While Wilsby was a relative newcomer, Tjärnström had been with Kindred Group since 2003, rising to the position of CEO in 2010. Although this might not be how Tjärnström envisioned his departure, he was still “very pleased” that Andén would be there to handle the transition.
Andén is familiar with Kindred’s operations. From 2006 through 2016, Andén was the head of poker, head of established markets, and the chief marketing officer for Unibet. He returned to Kindred in 2020 as chief commercial officer.
Meanwhile, there is plenty to do at Kindred beyond a potential sale. The company just announced the approval of its proprietary platform in New Jersey, as it seeks to improve Unibet’s performance. Pennsylvania will be next to get Unibet’s platform upgrade. Unibet also operates in Virginia, Arizona, and Indiana and has plans to expand into Illinois and Washington.
