William Hill is in talks with the Canadian owner of Pokerstars over a potential £5bn merger that could create one of the world’s biggest online gambling businesses.
The London-based bookies is reportedly locked in negotiations with Amaya. It comes after Britain’s biggest high-street bookmaker rejected a merger with UK rivals Rank Group and 888 Holdings after its board said a mooted £3.6bn proposal undervalued the business.
Indeed, both William Hill and Amaya have said the all-share deal would be one of equals that would be “consistent” with both their strategic objectives. A key part of William Hill’s reasoning is the chance for the merger to broaden its digital and international footprint.
Indeed, the Toronto-based Amaya is one of the biggest businesses in the online gambling sector, dominating a 70 per cent of the global poker market with 2.26 million active users each quarter and a database of more than 100 million users. Amaya’s revenue in 2015 was just over $1.3bn (£1.04bn) compared to William Hill’s £1.5bn haul in the same period.
Despite the negotiations, William Hill could face competition for Amaya in the form of GVC Holdings, which is also reportedly readying a play for the business. The Telegraph reports that Amaya’s share price rocketed over 9 per cent late on Friday night after news of the interest from both parties emerged, rising to $23.41 on the Toronto exchange, its highest value in nearly 12 months.
The move is the latest in a series of takeover talks, which has been reshaping the UK gambling space over the last year. Last year, Ladbrokes and Coral agreed to a £2bn union, which was quickly followed by a tie-up between Paddy Power and Betfair. The newly-created gambling giant is now worth almost £8bn and was swiftly followed a month later by the completion of GVC’s content against Israeli gambling company 88 to acquire Foxy Bingo owner Bwin.Party for more than £1bn.