William Hill shares rise as merger talks confirmed

William Hill shares rose in London yesterday after the UK bookmaker confirmed it is in talks on a possible combination with PokerStars owner Amaya of Canada, a deal that would further transform the landscape of a rapidly consolidating industry.

The company’s stock rose as much as 6.5% — before paring back in afternoon trading — to 313.6p, boosting the betting firm’s market value to £2.7bn (€3bn). Amaya gained 8.2% on Friday after Reuters reported that the company had received interest from parties including William Hill.

A deal would be the latest in a round of betting-industry consolidation that has included the combination of competitors Ladbrokes and Gala Coral, as well as Paddy Power and Betfair.

About $14bn (€12.6bn) has been splurged on betting-company takeovers in the past two years, according to data compiled by Bloomberg, more than in the previous three years combined.

The transaction “would create the largest global online gaming business”, James Wheatcroft, an analyst at Deutsche Bank, said.

“We think the deal could lead to significant cost savings” estimated at £100m (€111m).

The discussions concern a potential merger of equals, the companies said in a joint statement after markets closed on Friday.

Amaya’s market value of C$3.4bn (€2.31bn) is smaller than William Hill’s, though the Canadian company has more debt. A combination of the two would represent a reverse takeover of Amaya by the British bookmaker, according to Davy.