It seems that another mega-merger may take place within the gambling industry, thus forming an international online gaming and sports betting giant. Reuters reported on Friday that Canadian gambling operator and technology provider Amaya and major UK bookmaker William Hill were in talks about a potential merger. The report was confirmed by the two companies in a joint statement released later that day.
According to the statement, William Hill has been looking for ways to enhance the diversity of its product offering by growing both its online and international businesses. The two gambling companies pointed out that there were ongoing merger talks but that they would not necessarily end in a deal being closed. If, however, the two parties agree on a deal, they are expected to combine their operations in an all-share merger of equals.
In February, David Baazov, who was Amaya’s CEO at that time, announced that he was planning to buy the company for C$2.3 billion or C$21 per share, thus taking it private. A board committee was then assembled to review the offer as well as proposals from other parties.
In March, Mr. Baazov faced insider trading charges by Quebec’s securities regulator, Autorité des marchés financiers, in relation to the $4.9-billion deal for the acquisition of The Rational Group, the owner of PokerStars and Full Tilt Poker. The transaction was completed in 2014. Following the charges, he took an indefinite paid leave from his role as Amaya CEO. In August, Mr. Baazov resigned from his post and was succeeded by Rafi Ashkenazi. According to unnamed sources, he was no longer bidding for the Canadian gambling giant.
It was also reported on Friday that Isle of Man-based gambling operator and B2B supplier GVC Holdings was also among the suitors circling around Amaya. However, the company has not confirmed interest in its Canadian fellow so far. GVC Holdings acquired gambling operator bwin.party earlier this year and has since then been focused on integrating the newly added brands into its own operations.
If William Hill and Amaya merge together, this will certainly result in a new big player appearing on the gambling scene. The UK-based gambling operator has been looking for ways to improve and diversify its digital business after issuing a profit warning in March, noting that it would generate lower-than-expected profits this year and the decrease would be driven by its under-performing online division. As for Amaya, it, too, needs a significant boost as the insider trading investigation greatly affected the company’s trading activities.
Following the Reuters report, Amaya’s shares jumped 9% to C$23.41, hitting their highest from eleven months now.
William Hill has been the center of merger talks not once or twice over the past two years. First, the gambling company confirmed interest in online operator 888 Holdings last year. However, the latter not being happy with the price offered rejected the takeover bid.
This summer, William Hill was approached by The Rank Group and 888 Holdings with a proposal to be acquired by the two gambling groups. A first offer was rejected almost immediately. The major gambling operator, which now manages the biggest network of betting shops around the UK, did not accept a second, sweetened offer, which its two rivals made soon after.
