Largest Habbo Hotel shareholder pulls stake
Thursday, 14th June 2012 at 1:04 pm
UK private equity group 3i resigns from board after investigation into grooming allegations on the social network
The largest shareholder in Habbo Hotel developer Sulake has pulled its stake in the company after allegations that paedophile’s had been using the site.
UK private equity group 3i has given up its 16 per cent stake and resigned from the board following the “challenging circumstances” facing the Finnish studio.
A Channel 4 documentary aired on Tuesday evening described Sulake’s social network Habbo Hotel as a “paedophile haven”.
"3i has actively supported the Sulake board in determining the right course of action in these very challenging circumstances,” read a statement from the group, as reported by The Guardian.
“Following a board meeting today, we have resigned our board position and will cease to be a shareholder in the company."
The private equity group is the second company to withdraw its shares in Sulake this week after the studio’s second biggest shareholder, Balderton Capital, gave up its 13 per cent stake and also resigned from the board.
“We were given some information a week ago that profoundly shocked us,” a Balderton spokesperson stated.
“We had to ask ourselves whether we were comfortable being investors in a business where children were not being adequately protected."
“We didn’t take this decision lightly, as we have been investors in Sulake for over eight years, but the standards required to run a website that children have access to are very high. We felt the company was not meeting those standards.”
In response to the allegations facing Sulake, CEO Paul LaFontaine said it was doing “all it can” to keep children safe, and has recently turned off chat on the website whilst security issues are resolved.
"To keep users safe, we filter content and block inappropriate users,” he said.
“We also employ more than 225 moderators, tracking some 70 million lines of conversation globally every day on a 24/7 basis.”
© Develop 2013. All rights reserved.