William Hill’s Largest Investor Parvus Opposes Amaya Merger

  • Parvus says transaction would destroy shareholder value
  • Activist investor says bookmaker should pursue sale instead

William Hill Plc’s largest investor has come out against its proposed merger with PokerStars owner Amaya Inc., saying the U.K. bookmaker should pursue a sale instead.

Parvus Asset Management, a London-based activist investor that owns more than 14 percent of William Hill, said it was “extremely concerned” by the potential combination with the Canadian online gambling company, which had “limited strategic logic” and would destroy shareholder value. Amaya’s core poker business would weaken William Hill’s position in the market as that business is unattractive, Parvus said in a letter to William Hill’s board.

“We strongly encourage that the board and management stop wasting valuable time and shareholder resources pursuing this value-destroying deal,” said the letter, signed by Parvus co-founders Mads Eg Gensmann and Edoardo Mercadante. William Hill should consider “all alternative options available, including a sale.”

“Given the strategic fit, diversification and potential synergies we have a responsibility to all our shareholders to fully assess this,” a William Hill spokesperson said via e-mail. “However it is premature for us to draw conclusions while this work is ongoing.”

William Hill and Amaya said Oct. 10 that they were discussing a potential merger of equals, and the combined company would be worth around $5.5 billion. William Hill recently staved off a takeover by smaller rivals 888 Holdings Plc and Rank Group Plc, and is seeking a new chief after ousting James Henderson. Amaya has faced the possibility of being taken private by former Chief Executive Officer David Baazov.

William Hill’s shares were little changed at 299 pence in London Thursday. Amaya fell as much as 5.1 percent to C$21.76 in Toronto.

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