GGRAsia – Amaya, William Hill end merger talks: statement

Amaya, William Hill end merger talks: statement

Oct 19, 2016 Newsdesk Latest News, Top of the deck, World

Amaya Inc, the owner of the PokerStars online gambling brand, says it has ended talks with United Kingdom-listed betting firm William Hill Plc regarding a possible merger of the two firms.

“Those discussions have concluded, and Amaya and William Hill have determined that they will no longer pursue the merger,” Toronto-listed Amaya said in a Tuesday press statement.

The document did not give a reason for the talks being discontinued. It did mention “certain inaccuracies contained in an open letter from a William Hill shareholder to William Hill’s board of directors”, and invited interested parties to view “clarifications” on that topic via Amaya’s website.

On Friday, international media outlets had reported that Parvus Asset Management, said to be the largest single shareholder in William Hill, with 14.3 percent, had criticised the merger idea – which had been touted in some quarters as potentially creating one of the world’s largest gambling businesses. Parvus had said the idea had “limited strategic logic and would destroy shareholder value”.

In a separate statement on Tuesday, William Hill 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. Accordingly, the board has informed Amaya that it is withdrawing from discussions and wishes Amaya well for the future.”

On October 8, Amaya had described the proposal as “a potential all-share merger of equals”.

U.K. news reports had described it at the time as a GPB4.5-billion (US$5.5-billion) to GPB5-billion exercise. The British pound has experienced some sustained weakening amid uncertainty about the U.K.’s path toward Brexit – exit from the European Union.

Amaya posted on its pokerstarsblog.com website – that links to its official corporate site – what it referred to as a “response to inaccuracies regarding our business”.

“It is simply not true to say that poker is a mature or declining market based upon certain public data which under-reports the size and growth of the poker market,” said the blog, carrying the byline of Eric Hollreiser, vice president of corporate communications of Amaya and PokerStars.

Divyesh Gadhia, chairman of Amaya, said in the Tuesday statement from the group: “Amaya is a strong and growing company with experienced management and a proven strategy to deliver profitable growth and shareholder value.”

He added: “Together with our financial advisors, we evaluated a wide range of strategic alternatives to maximise shareholder value and have concluded that remaining an independent company is in the best interest of Amaya’s shareholders at this time.”

PokerStars claims to control 70 percent of the online poker market globally, saying it has 2.26 million quarterly active users and a database of more than 100 million users. In Asia the brand is affiliated with the Asia Pacific Poker Tour, which offers live poker tournaments at casino venues around the region.