Acquisition fight for Will Hill not over yet

William Hill plc’s rejection of the GBP 3.16 billion 888-Rank acquisition bid this week has not deterred the bidders, who embarked Wednesday on a campaign to progress the venture, intimating that they remain open minded on pricing and laying out a raft of merger advantages in a detailed explanatory statement clearly aimed at shareholders (see previous reports).

The 888-Rank alliance called for further talks in order to create what they claim will be “the UK’s largest multi-channel gambling operator by revenue and profit”, with 92 percent of its business from regulated markets.

Their offer envisages Will Hill shareholders retaining 44.7 percent of the enlarged company, 888 shareholders 44.7 percent and Rank investors 29.6 percent.

Rank’s chief executive Henry Birch would become CEO of the new group and Itai Frieberger, current 888 chief exec, CEO of Digital operations.

Birch took to the UK press to promote further “friendly” talks on the summarily rejected offer, telling The Telegraph newspaper that the bidders were prepared to consider lifting their initial bid and claiming that the advantages of a merger and the GBP 100 million in savings possible are “blindingly obvious.”

He claimed that the merger would create the UK’s biggest multi-channel operator with massive potential for success.

Meanwhile, Frieberger commented: “The price is something that we can always discuss.”

However, William Hill chairman Gareth Davies remained dismissive, reiterating his view that “the board continues to see no merit in engaging on the basis of a proposal that substantially undervalues the group. In addition, as we have said before this proposal is highly opportunistic, complex and poses significant risk for our shareholders.”

Earlier in the day 888 principal shareholder Eyal Shaked appeared to take a more angry and frustrated approach to the William Hill rejection, taking to Twitter to opine:

““Pure ego made #WilliamHill reject #Rank and #888 £3.16bn bid and that will be their downfall. That’s the last I want to hear about #888 shareholders not willing to go big.”

Our readers may recall that William Hill blamed its failure to acquire 888 last year for GBP 700 million on a major 888 shareholder’s contention that the valuation was too low, and Shaked referred to this in a further tweet, commenting:

“Last year it was ‘key shareholder opting for higher returns’, now it’s an opportunistic offer. See you next year…”