William Hill's largest shareholder blasts potential Amaya merger

£4.5bn potential merger of William Hill and Amaya has been dealt a blow, after the British operator’s largest shareholder came out in public opposition to a deal.

Parvus Asset Management, which owns 14.3% of William Hill, has condemned the proposition, stating in an open letter to the Hills board that the merger has “limited strategic logic and would destroy shareholder value.”

Mads Eg Gensmann and Edoardo Mercadante, co-founders of Parvus, wrote: “We strongly encourage that the board and management stops wasting valuable time and shareholder resources pursuing this value-destroying deal.

“Instead, the board and management must focus on maximising value for William Hill owners, rather than Amaya shareholders, by considering all alternative options available, including a sale of William Hill.”

Parvus’ main points of contention concern Amaya’s focus on i-poker, which the letter dismissed as a “mature, if not structurally declining, revenue stream”, and the debt carried by Amaya following its $4.9bn acquisition of PokerStars in 2014.

Gensmann went on to tell Reuters that “it shouldn’t take more than five minutes of the board’s time to realise this deal doesn’t pass the smell test”.

In response to the letter, a William Hill spokesman said: “Given the strategic fit, diversification and potential synergies we have a responsibility to all our shareholders to fully assess this.

“However, it is premature for us to draw conclusions while this work is ongoing.”

News of a potential merger between the two broke last weekend, with William Hill stating at the time that: “The potential merger would be consistent with the strategic objectives of both William Hill and Amaya and would create a clear international leader across online sports betting, poker and casino.”