888 chief departs immediately as firm's share price drops by more than 27 per cent

The share price of 888 plummeted by more than a quarter on Monday after William Hill's parent company announced the immediate departure of chief executive Itai Pazner and at the same time suspended its VIP activities in the Middle East over failures in its anti-money laundering processes.

Pazner, who led 888 for four years having been with the firm for more than two decades, will be replaced on an interim basis by non-executive chair Lord Mendelsohn, who assumes the position of executive chair while the board searches for a successor. 888's share price was down 27.47 per cent at 74.85p at close of trading on Monday following the release of the two statements. No reason was given for Pazner's exit.

Analysts at stockbrokers Goodbody estimated that the suspension of VIP activities could result in a £30 million to £40 million hit to 888's full-year earnings. They added: "While we are unlikely to get full clarity on these issues in the near term, the focus for the group now needs to be appointing a new executive team to remove some of the uncertainty around the investment case."

Lord Mendelsohn said: "On behalf of the board I would like to thank Itai for his significant contributions to the business over more than 20 years, including the last four as CEO. Itai has played a very important role in building a business with powerful proprietary technology, and has overseen successful early stages to the William Hill integration process. We wish him well in his future endeavours."

In a statement posted on Linkedin, Pazner said he was proud of the part he played in the development of 888. He added: "I was fortunate to have had the most amazing career with 888 and am honoured to have had the opportunity to work with some extraordinarily talented people.

"I want to thank every one of these colleagues and wish them and the company the best of luck as we take our separate steps in the next part of life’s exciting journey."

Itai Pazner: led 888 as chief executive for four yearsCredit: Oren Izre'el www.oizreel.co

888 also announced it had launched an internal compliance investigation after it had come to light certain best practices have not been followed in regard to Know Your Client and Anti-Money Laundering processes for 888 VIP customers in the Middle East region.

"While further internal investigations are under way, the board has taken the decision to suspend VIP customer accounts in the region, effective immediately," the company said in a statement.

"The board currently estimates that the impact is less than three per cent of group revenues, should the suspensions remain in place. Based on the board's current understanding, the process deficiencies identified are isolated to this region only."

Lord Mendelsohn said: "The board and I take the group's compliance responsibilities incredibly seriously. When we were alerted to issues with some of 888's VIP customers, the board took decisive actions. We will be uncompromising in our approach to compliance as we build a strong and sustainable business."

888, which completed the acquisition of William Hill last summer, reported in a trading update this month that online revenues for the whole of 2022 had fallen by 15 per cent and five per cent for the last three months of the year. It was reported last week the company had begun a series of redundancies in its Israel operation as part of a cost-saving process.

888 had also announced chief financial officer and executive director Yariv Dafna would step down from his role at the end of March, but on Monday it emerged he had agreed to remain in his posts until the end of 2023.

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