The board of leading British bookmaker, William Hill, has turned down a €4.2 billion joint takeover bid made by 888 and the Rank Group. The unsolicited bid came with the aim of combining the three gaming companies.
The board of William Hill described the offer as a “substantial risk” for shareholders of the company, saying the outcome would be a “complicated three-way combination.”
“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,” read a statement by the company.
“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.”
According to the bid, 888 would act as the acquiring entity and would create BidCo which would then acquire William Hill for a cash amount, plus shares in the new company. William Hill said that the offer represented 364 pence per William Hill share considering the closing price of 888 and Rank on August 5. This, according to William Hill, represented just an 11 percent premium on William Hill’s 327 pence share price on August 8.
Despite William Hill seeing two years of disappointing performance and removing their chief executive James Henderson after only two years, the company says they are seeing a turnaround. Earlier this month, the company reported a one percent rise in revenue for the first half of the financial year with strong results from the Euros football tournament which countered their low online sales.