Amaya
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Shares in Montreal-based Amaya are trading about 20 percent below Baazov’s C$24 a share bid on concern about the financing for his offer. A Dubai-based investor said last month its purported backing for the deal announced Nov. 14 was given without the firm’s knowledge or consent. In a subsequent filing to the U.S. Securities and Exchange Commission, Baazov said two Hong Kong funds -- Head and Shoulders Global Investment Fund SPC and Goldenway Capital SPC -- agreed to boost their support as a result. The little-known entities make the offer look more suspicious, Ader said.
“If we have a credible bid with transparency, then we should consider it,” Ader said. “But the current price seems low and the lack of transparency and the information about the sources of funding raises a lot of questions.”
Adding Shares
New York-based SpringOwl, which owned less than 1 percent of Amaya as of Sept. 30, has more than doubled its stake since then, according to Ader, a former gaming and casino analyst at Bear Stearns Cos and a director of Las Vegas Sands Corp. The company manages only its own capital.
“Mr. Baazov stands behind his offer and intends to continue engaging constructively with Amaya towards a board supported transaction,” his spokesman Riyaz Lalani wrote in an e-mailed response.
Baazov stepped down as CEO this year after he was charged in an insider trading probe by Quebec’s securities regulator. He has denied the allegations.
In his letter to CEO Rafael Ashkenazi and Chairman Divyesh Gadhia, Ader said Amaya should consider placing Baazov’s shares in a divestiture trust. According to regulatory filings, Baazov is Amaya’s second-largest shareholder, with a 17 percent stake.
Hiring Delays
Amaya received a letter from SpringOwl and “will continue to engage constructively” with the investor, spokesman Eric Hollreiser said in an e-mail. “The Board and management welcome input from all of our shareholders and look forward to continuing to actively engage with them.”
The uncertainties surrounding the offer are holding back a valuable company and delaying hiring, according to Ader, who in his letter called Baazov’s bid “a continued attempt by a discredited former executive to capitalize on the Amaya situation at other shareholders’ expense.”
Amaya rose 0.6 percent to C$19.22 at 12:21 p.m. in Toronto for a market value of C$2.79 billion ($2.1 billion).
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