Bookmaker William Hill has turned down a revised takeover proposal from rivals 888 and Rank.
The group rejected an initial £3.16 billion approach from the duo last week, and today said it sees “no merit in engaging” with the consortium.
While 888 and Rank have maintained the cash element of their advance at 199p per William Share, they have increased the number of shares the bookmaker’s investors would receive in their bid vehicle to 0.860, up from 0.725 previously. That would see William Hill shareholders owning 48.8 per cent of the combined group, compared with 44.6 per cent under the earlier proposal.
William Hill chairman Gareth Davis said: “This revised proposal continues to substantially undervalue the company and the cash element of the proposal has not changed. Therefore, the board sees no merit in engaging.
“As we have said before, this is highly opportunistic and complex and does not enhance the strategic positioning of William Hill. The board continues to believe we have a strong team to deliver superior value to our shareholders and trading at the start of the second half gives us renewed confidence in our stand-alone strategy.”
Under City takeover rules, 888 and Rank have until 21 August to either make a formal offer or walk away. The pair said they would be able to squeeze out savings of “at least” £100 million by combining the three businesses.
888 chief executive Itai Frieberger said: “We are extremely excited by the prospect of creating a dynamic, broad based, multi-channel gambling business of real scale. We expect the combined business to lead innovation in the sector, drive growth and deliver superior returns for all shareholders.”
His counterpart at Rank, Henry Birch, added: “With a 48.8 per cent share in the combined business, the largest proportion of the benefits would accrue to William Hill shareholders (as well a significant cash payment), and we hope to engage the William Hill board in constructive discussions to deliver a deal that makes compelling strategic sense for all three businesses.”