Baazov Bids For Amaya Gaming Stock

David Baazov and several undisclosed investors have made an offer of $2.8 billion to buy the shares of Amaya Gaming, one of the world's largest online gambling companies. What makes this bid more interesting is that Baazov is the Chairman of the Board, President and CEO of Amaya who already owns 18.6% of the stock. Based on this offer the bid price works out to an estimated $21 per share. On the day the news broke out the share price immediately climbed 27% and closed the day up 20% at $18.

One of the imputed objectives in this offer is that Baazov wants to make the company private. The leading online gambling expert, Calvin Ayre, supports this thinking. Amaya has been on a roller coaster ride for the last several months mainly due to the government investigations into its acquisition transactions and it needs to move away from the public glare in order to prosper. The share price crossed $37 in February 2015 after the acquisition of Full Tilt and PokerStars. But the revised guidance for 2016 saw the shares fall to less than $15 in November 2015. This was attributed to the slower than anticipated legalization of online gambling in the United States and Russia. Another imputed reason is that Baazov wants to bump up the price of the stock and appease existing investors until the US legislation allows online poker or Russia legalizes online gambling.

Many believe that Baazov is interested in acquiring greater control of the company that he built up. Baazov has gone on record stating that he was "confident that the online gaming and technology industry has a bright future in Quebec and Canada". Deloitte has ranked Amaya as third on the list of the 50 fastest-growing Canadian technology companies. It also ranked Amaya at 23rd on its list of the 500 fastest-growing technology, media, and telecommunications companies in all of North America. Baazov wants more of the pie for himself.

Financial market experts feel that many of the shareholders of Amaya will be reluctant to let go of their stock at a price of $21. With so many acquisitions in the online gambling industry in the recent past, those shareholders will expect better prices. The bottom line for players at the Amaya online gambling sites is that the reason or outcome of this bid will not make any difference to them. They will continue to get great online poker and casino products as before.

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