SCi boss forced out after shares freefall

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The founder of SCi Entertainment was forced to resign yesterday after 20 years at the helm of the video game publisher, forced out by shareholders angered by its recent precipitous share price drop.

Jane Cavanagh, chief executive of the group famous for its Tomb Raider series, stepped down "with immediate effect," as did Bill Ennis, her husband and a managing director, and Rob Murray, who was also on the board. The shake-up was led by investors, including Robert Tchenguiz, the group's single biggest shareholders with 15 per cent, who have been left sitting on massive losses after its shares lost more than half their value in a day last week when the company said that long-running takeover talks with an anonymous suitor had ended.

SCi also said that it would delay the release of four new games until later this year, which will push it into loss and likely mean that it will need to raise additional funds to stay afloat. Chief financial officer Phil Rogers has been appointed to replace Ms Cavanagh. Malcolm Dunne, chief financial officer of the American business, will step in as interim CFO for the group.

Chairman Tim Ryan called the dismissal of Ms Cavanagh, a respected figure in the industry, "difficult". He said: "Farewells like this are never easy. It was a very, very difficult time for Jane but she is the consummate professional." Mr Ryan said the company was not experiencing an immediate cash crunch, despite analyst fears that it could need to raise up to £30m. "The first priority is to take a thorough look at the business and strategy. We don't have to rush into any decisions or deals with anyone."

The company will report back to shareholders on its financing position and on the findings of its review by the end of February. News of the shake-up heartened investors, who bid the shares up to 70.5p. However, the stock is still down about two-thirds during this month alone.