William Hill has been dealt a blow regarding its potential merger with Amaya after Parvus Asset Management, the largest single shareholder in the bookmaker, said it would oppose any deal.
Last week, William Hill and Amaya revealed that they had opened talks over a merger that could lead to a combined operation worth £5.7 billion (€6.3 billion/$7 billion).
However, speaking in an open letter to William Hill’s board, British investor firm Parvus, which holds a 14.3% stake in the bookmaker, said that the merger had “limited strategic logic and would destroy shareholder value”.
Parvus has instead called on the betting firm to look at “all alternative options for maximising shareholder value”.
Mads Eg Gensmann, co-founder of Parvus, told the Reuters news agency: “It shouldn't take more than five minutes of the board's time to realise this deal doesn't pass the smell test.
“We strongly encourage that the board and management stops wasting valuable time and shareholder resources pursuing this value-destroying deal.”
In response, a William Hill spokesperson said: “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.
“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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