Deal goes kaput
William Hill has rejected a £3.2bn joint bid from rivals Rank Group and 888 for “substantially” undervaluing the troubled bookmaker.
Rank, the operator of Grosvenor casinos and Mecca bingo halls, and online gambling operator 888 made a cash-and-stock bid for William Hill. The offer was valued the bookie at 364p-a-share.
Under the terms, they proposed a three-way deal that would see Rank and 888 merge to form a new company called BidCo. The new firm would have then offered to acquire William Hill.
In addition to this, BidCo would take on £2.2bn of debt to help finance the deal.
“This conditional proposal substantially undervalues William Hill, is highly opportunistic and does not reflect the inherent value of the business,” said Gareth Davis, the bookie’s chairman. “It is a very complex three-way combination at a low premium involving substantial risk for William Hill shareholders: execution risk, integration risk and risks of materially increased leverage.”