David Baazov is Back with a $6.7 Billion Takeover Bid for Amaya

November 14th, 2016 | by Brian Corlisse

David Baazov offers $6.7 billion for Amaya.

David Baazov formally offers Amaya a takeover deal which is worth a total of $6.7 billion. (Image: Corey Hendrickson/ The Globe and Mail)

Former Amaya CEO David Baazov may be under investigation for potential financial crimes, but that hasn’t stopped him from putting together a $6.7 billion bid for the company.

Back in March, Baazov was one of five individuals and three companies hit with 23 charges by the Autorité des marchés financiers (AMF).

The Canadian financial securities regulator swooped on Baazov et al after evidence of potential insider trading linked to Amaya’s PokerStars takeover emerged.

Baazov Ignores Legal Issues to Make Bid

Although Baazov has maintained his innocence, he resigned from his post at Amaya back in August and has remained under investigation ever since. In fact, with the AMF reporting it had found new evidence of possible corruption (a bag filled with $87,000 in cash) back in September, Baazov is by no means in the clear.

But, regardless of his legal battle, he’s still managed to pull together a team of major investors to help fund his takeover plans which have been in the works for almost 12 months.

Indeed, Baazov toyed with an offer of $21 per share back in February. But, with the AMF investigation starting just two months later, that deal fell apart.

Now, however, Baazov is back with a revised offer of $24 per share. With help from a selection of unnamed backers, the value of his own shares in Amaya (worth around $427 million) and major companies, including Golden Capital SPC and Ferdyne Advisory Inc, Baazov is hoping to secure the company for $6.7 billion.

A Generous Offer

That offer is markedly more than the current trading price for Amaya (around $21 per share) and could be just enough to tempt the current board into signing on the dotted line. Back in October, a proposed merger between Amaya and William Hill was abandoned after the former’s shareholders suggested the valuation was too low.

In this instance, Baazov is offering more than the current market rate and, according to his letter of intent, a deal that can be completed quickly and with the minimum amount of risk.

“Because of my familiarity with Amaya, I am in a position to negotiate a definitive agreement that need only contain limited representations and warranties, on an expedited basis, thereby reducing any distraction to management,” wrote Baazov.

One of Baazov’s main reasons for wanting to take the company he helped create into a private state is the evolution of the gaming market. In his opinion, the red tape and cost of being a public company doesn’t offer Amaya or its subsidiaries any benefits.

If Baazov is successful in making Amaya a private company, it could be beneficial for players at PokerStars and Full Tilt. Both companies flourished as private entities under their old owners and that could be the same this time around.

Without having to consider market value and satisfying shareholders, Baazov could broker deals with companies like William Hill and that could potentially enhance the poker offerings of all involved.