Playtech Shareholders Reject Barinboim Bid for Finalto
Playtech’s shareholders have rejected a proposal to sell its financial trading division to a management consortium, opening up the possibility of negotiations with rival bidders.
The company board had initially agreed to sell Finalto to a consortium led by an Israeli private equity fund, the Barinboim Group. That deal, agreed in May, was worth up to $210 million. However, in July, Playtech minority shareholder Gopher Investments submitted its own bid, worth $250 million.
As a result of that bid, Playtech delayed its general meeting, at Gopher’s request, where shareholders were due to vote on the Barinboim deal in order to give the board time to gather more information about Gopher. There were some concerns about Gopher’s ownership structure, its links to China, and whether there would be any difficulties in obtaining regulatory approval for the sale.
Gopher answered initial questions, but Playtech said that it needed further clarity and information about some of the responses. Gopher was then slow to respond, which led to Playtech’s board announcing that it will continue to support the Barinboim bid and scheduling the general meeting for 18 August.
However, at the meeting, despite the board approving of the Barinboim deal, the majority of voting interest rejected it. In total, shareholders representing 75.3 million shares voted for the deal, but shareholders with 164.3 million shares voted against it.
This means that Barinboim will now cancel its sale and purchase agreement with Playtech’s board. This will allow Playtech to enter into formal negotiations with other interested parties, such as Gopher.
Playtech understands that by voting against the resolution to dispose of Finalto to the consortium, shareholders have been willing to accept the risk of the SPA terminating, thereby enabling Playtech to engage with Gopher and to potentially secure better terms for a sale of Finalto.
The consortium, which was created especially to purchase Finalto, will continue to exist for 30 days and try to enter into a more favorable sale and purchase agreement.
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