Amaya William Hill Merger Shareholder Disruption

Published Friday, October 14, 2016 -
Amaya William Hill Merger Shareholder Disruption

The merger talks that have everyone in the online gambling industry noticing has hit a snag with one of the shareholders in the William Hill enterprise rejecting the proposed merger with Canadian online gambling firm Amaya Gaming.

William Hill stands to gain from a merger in the digital sector where the company has been struggling to maintain presence in the competitive internet wagering market. Amaya Gaming is still a risky business to invest in with some of the baggage it still carries from the PokerStar and Full Tilt investigation in the USA including the $870 million fine against PokerStars issued by a US judge for breaking regulations.

William Hill and Amaya have revealed mostly because of regulatory constraints they were in actual  merger talks that could lead to a combined operation worth £5.7 billion (€6.3 billion/$7 billion). The investors have been looking at the situation from a stock value perspective and one leading investor has written an open letter to the William Hill board of directors.

Parvus Asset Management, the largest single shareholder in William Hill holds a 14.3% stake said that the merger had “limited strategic logic and would destroy shareholder value”. Parvus asked the board to search for, “all alternative options for maximising shareholder value”.

Reuters quoted Mads Eg Gensmann, co-founder of Parvus, “It shouldn't take more than five minutes of the board's time to realise this deal doesn't pass the smell test.” Adding, “We strongly encourage that the board and management stops wasting valuable time and shareholder resources pursuing this value-destroying deal.”

A William Hill spokesperson responded,  “Given the strategic fit, diversification and potential synergies we have a responsibility to fully assess this, however it is premature for us to draw conclusions while this work is ongoing. ” adding, “The board would not come forward with a transaction unless it was satisfied that it was in the interests of all shareholders.”





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