William Hill rejects Rank Group and 888’s bid

The bookmaker rejected the £3.6 billion (€4.2 billion) takeover offer from Rank Group and 888.

UK.-  William Hill rejected a takeover offer from Rank Group and 888. The bookmaker said that the proposal for a £3.6 billion (€4.2 billion) three-way merger “substantially undervalues” company.

In response to a formal takeover offer from the casino operator and online betting firm, William Hill said it does not believe a tie-up would enhance its “strategic positioning or deliver superior value for shareholders” in comparison with its own strategy.

“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,” said the bookmaker.

The offer, amounting to 364p per share (€425.82), also involved saddling the newly formed company with £2.2 billion (€2.5 billion) of debt. Last week, the bookmaker said half-year profits were boosted by a strong Euro 2016, helping offset a dire Cheltenham Festival.

“This conditional proposal substantially undervalues William Hill, is highly opportunistic and does not reflect the inherent value of the business,” said Gareth Davis, chairman of William Hill. “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. The group has a strong team to deliver against our strategy to grow our digital and international businesses so we strongly advise that shareholders take no action.”