William Hill’s board has rejected a takeover bid from 888 and Rank Group that valued the gaming operator at around £3.6 billion (€4.2 billion/$4.7 billion).
In a statement, William Hill said the bid envisaged an inter-conditional all-share merger of 888 and Rank, with 888 acting as the acquiring entity, to create BidCo, which would purchase William Hill for cash and newly issued shares in BidCo.
Hills said the proposal represented a value of 364 pence per William Hill share based on the closing price of 888 and Rank on August 5. It added that the proposal therefore represented a premium of just 11% on the William Hill share price of 327 pence on August 8.
Describing a “substantial risk” for William Hill shareholders of what it considers a “complicated three-way combination”, the company said: “Having reviewed the proposal with its financial advisers, Citi and Barclays, the board of William Hill has unanimously rejected the proposal as it substantially undervalues William Hill.
“In addition, the board of William Hill does not believe that a combination of William Hill with 888 and Rank will enhance William Hill's strategic positioning or deliver superior value for shareholders compared against William Hill's strategy, which is focused on increasing the group's diversification by growing its digital and international businesses.”
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