Published On: Tue, Oct 18th, 2016

William Hill Abandons Amaya ‘Merger of Equals’ on Investor Dissent

AMAYA David Baazov

 

William Hill Plc and PokerStars owner Amaya Inc. of Canada ended merger discussions after the U.K. bookmaker’s largest shareholder voiced opposition to the move.

Amaya and William Hill PLC Oct 10 said they were in discussions regarding a potential all share merger of equals, in a transaction that would have created the largest global online gaming business. Those discussions have concluded, and Amaya and William Hill have determined that they will no longer pursue the merger.

In two separate statement Tuesday by the companies:

William Hill said it will continue to consider strategic alternatives where they have the potential to create shareholder value, the London-based company said in a statement .

Amaya, the online gaming group, said its board concluded that remaining an independent publicly traded corporation best positions it to deliver long-term shareholder value, and wishes the best for William Hill and its shareholders.
“Amaya is a strong and growing company with experienced management and a proven strategy to deliver profitable growth and shareholder value, ” said Divyesh (Dave) Gadhia, Chairman of Amaya. “Together with our financial advisors, we evaluated a wide range of strategic alternatives to maximize shareholder value and have concluded that remaining an independent company is in the best interest of Amaya’s shareholders at this time. The Board has full faith in Amaya’s management to execute on its strategy and objectives.”

The London-based company will restart share buybacks, which it suspended in July, it said. “After canvassing views from a number of William Hill’s major shareholders, the board has decided that it will not pursue discussions with Amaya, ” the U.K. company said in the statement. “Accordingly, the board has informed Amaya that it is withdrawing from discussions and wishes Amaya well for the future.”

The decision marks a pause in a spate of deals in the gambling industry that has included the combination of Ladbrokes and Gala Coral, as well as Paddy Power and Betfair, Bloomberg reports.

Betting-company takeovers have totaled about $14 billion in the past two years, according to data compiled by Bloomberg, more than in the previous three years combined.

Quebec-based company said in the statement that Amaya has been informed by its former Chief Executive Officer, David Baazov, that he continues to be interested in taking the company private. “The Special Committee has not received an offer from Mr. Baazov that it or its advisors believes is capable of resulting in a completed transaction.” the statment writes, “Accordingly, while the Board will consider any bona fide offer that Mr. Baazov or any other party may make, Amaya’s review of strategic alternatives has concluded.”

Baazov stepped down from his role this year and in February made a non-binding indication that he was in discussions with investors to make an offer for the company valued at around C$2.8 billion, or C$21 a share.

William Hill recently staved off a takeover by smaller rivals 888 Holdings Plc and Rank Group Plc, and is seeking a new CEO after ousting James Henderson.

 

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