William Hill turns down Rank and 888's ₤ 3.16 bn quote

Bookmaker William Hill has actually rejected a ₤ 3.16 bn takeover deal from online operator 888 and gambling establishment giant Rank.

The quote, in shares and cash, was called "extremely opportunistic" by Gareth Davis, chairman of William Hill, who said it did not show its real value.

The deal would produce the yohaig code UK's third-largest online wagering group with incomes of ₤ 2.7 bn.

William Hill shares have risen 22% to 334p since 888 stated last month that it was thinking about a joint quote with Rank.

The quote would mean 888 taking control of Rank, with the newly formed company then buying William Hill.

Mr Davis stated that it would include some ₤ 2.2 bn in debt. He said: "It is a really intricate three-way mix at a low premium including considerable danger for William Hill shareholders: execution risk, integration threat and threats of materially increased utilize."

But Rank and 888 argue that its service plan would increase the business's value to up to 408p a share - or ₤ 3.6 bn.

888 and Rank stated that they see "significant commercial logic in the combination, through combination of their complementary online and land-based operations, delivery of considerable earnings and cost synergies, and from the expected benefits of economies of scale which will accumulate to all investors."

Turnaround

William Hill said that it was currently seeing a turn-around in its own online company, and while a merger would provide it access to 888's offshore markets it responded that it was currently seeing development of 12% in its Australia operation and 49% in operating revenues in the US.

William Hill tried and failed to acquire 888 in a ₤ 700m deal last year.

John Colley, a Professor of Practice at Warwick Business School said the bid "looks particularly opportunist as William Hill have lost their primary executive James Henderson after 2 years of frustrating performance with the yohaig code shares at a lowly 336p compared with the 364p bet9ja's welcome offer.

"However William Hill is now in play and others may be together with enhanced deals and more cash.

"The industry is combining rapidly and William Hill, Rank and 888 will be part of that one way or another. For this promotion code reason, Rank and 888 ought to also beware."

Other mergers in the industry consist of Ladbrokes and Coral signing a ₤ 2.3 bn merger in July and Paddy Power and Betfair joining forces in September.

William Hill shares struck by revenue alert

23 March 2016