Canadian based Amaya Inc is currently considering an acquisition proposal submitted by David Baazov, the former chairman and chief executive officer. Baazov sent in a proposal last month offering C$24 per share which is around 20 percent more than what Amaya Inc shares a currently trading at.
David Baazov initially stated that he had investors from Dubai and Hong Kong backing the acquisition but the Dubai based company that he had put down as a backer, released a statement to dispute that claim. However the two Hong Kong based investors – Head and Shoulders Global Investment Fund SPC and Goldenway Capital SPC confirmed that they would increase their amount of investment to support the acquisition.
U.S based SpringOwl Asset Management one of Amaya Inc’s investors who have been increasing their stake in the company recently sent a letter to Amaya’s current chairman and chief executive officer expressing their concerns over Baazov’s acquisition proposal. The letter questioned Baazov’s credibility and his source of funding for the acquisition.
Jason Adder, the chief executive officer of SpringOwl Asset Management asked the current management of Amaya Inc to move on from Baazov’s influence and also pointed out that the former chairman had distracted management. Adder wants Amaya Inc to focus on growing its business and continuing to stay ahead of the competition.
In a statement, Adder said “If I were making a $4 billion bid and would want the shareholders to take me seriously, I would provide much more transparency to the shareholders. If we have a credible bid with transparency, then we should consider it. But the current price seems low and the lack of transparency and the information about the sources of funding raises a lot of questions.”
Earlier this year, Baazov temporarily stepped down from his post of chairman and chief executive officer of Amaya Inc after insider trading allegations were filed against him by Canadian authorities. He would later go on to permanently resign from all posts while claiming to be innocent of all charges and vowing to clear his name. Baazov responded to the SpringOwl Asset Management letter via his representative by saying that he stands behind his acquisition proposal and will continue to constructively engage with Amaya Inc to see if a board backed transaction could take place.
In October 2016, UK bookmaker William Hill had expressed its intention of a merger of equals with Amaya Inc but decided to abandon those plans after Parvus Asset Management, one of its major shareholders objected to the potential merger.
Baazov is the second biggest shareholder in Amaya Inc owning a 17 percent stake in the company. SpringOwl Asset Management owned a 1 percent stake in the company prior to September 30 but since then has doubled its stake in the company. Eric Hollreiser, the VP of Corporate Communications for Amaya Inc and PokerStars stated that the board welcomed feedback from all its shareholders and would continue to have constructive discussions with them.