Former Amaya CEO David Baazov is officially done trying to buy out other shareholders and take sole ownership of the company he founded, nine months after he stepped down in his role with the company.
Baazov was offering C$24 per share to fellow stockholders. The offer was a premium over the current value of the stock, but not enough for a number of people. With asking prices too high, Baazov has thrown in the towel. Amaya confirmed the sale attempt is over via press release.
Baazov spearheaded PokerStars acquisition
Baazov’s current situation with Amaya is far from positive. He has had some high points with the company though, and led it through a series of changes. He was the catalyst behind the $4.9 billion acquisition of Full Tilt Poker and PokerStars in 2014.
At the time, Amaya was a small, publicly traded company. The acquisition made it the biggest player in online gambling.
Insider trading allegations derailed Baazov’s plans
Things were going well for Baazov until March of this year. He and two others faced charges of insider training. The charges resulted in Baazov’s removal from his post as CEO. He maintains he is not guilty of any wrongdoing.
The charges stem from the PokerStars acquisition. While he is no longer CEO, Baazov is still a major shareholder in Amaya, controlling 17 percent of the stock.
Asset management group SpringOwl is also a stakeholder; it wrote a letter to the board advising they fully divest themselves from Baazov. The letter also suggests putting Baazov’s shares in a trust to indicate to authorities the company’s intent to completely remove Baazov from business operations.
Buyout had problems from the jump
In November, Baazov announced his intentions to buy Amaya and privatize it with a $6.7 billion plan. The announcement named KBC Alibini Capital as a major financier. The problem is, they weren’t.
Baazov had to make another announcement rescinding his statement. He explained he received a letter he believed to be an offer from them that turned out to be a fake.
Baazov continued with his plan undeterred. He assured the public financing was happening from a number of other firms. He apparently had financial backing, but lacked interest from his fellow shareholders.
“It became evident that the share price premium demanded by certain shareholders exceeded the price at which my investors and I would be willing to complete a transaction,” Baazov said in the latest announcement he was withdrawing his bid.
The announcement resulted in a five percent drop in Amaya share prices.
It has been a tumultuous year for the company. Talks about a possible merger with William Hill never came to fruition. The company has also been trying to appeal a 2015 judgment in Kentucky courts which ruled the company owed the state $870 million.