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(Alliance News) -Â Gopher Investments on Friday said it has made a USD250 million cash offer for Playtech PLC's Finalto business, above the current board recommended offer.
In late May, Playtech unveiled plans to sell its financial trading division, Finalto, for up to USD210 million. The sale is being made to a consortium led by Barinboim Group and backed by Leumi Partners and Menora Mivtachim Insurance, together with "key members" of the division's management team.
Under the consortium deal, Finalto is being sold for a fixed amount of USD185 million, of which USD15 million is deferred for up to two years from completion. A further USD25 million is contingent on the business meeting certain targets.
However, Gopher - which holds just under a 5% stake in Playtech - emerged on Friday with an improved offer.
Gopher's USD250 million bid represents a 47% premium to the base proposal from the consortium, and a 19% premium to the maximum considerate payable.
"Gopher's all-cash offer includes no deferred or contingent component, delivering full value up front and allowing Playtech to receive proceeds with certainty and in full on completion, securing the clean break which the board has declared as an objective of the transaction. Gopher's offer will be financed from funds which are immediately available," it highlighted.
Gopher believes the current offer on the table does not fairly reflect Finalto's "attractive" growth
prospects.
It presented the offer to the Playtech board on Tuesday, but received a written response on Friday saying the company has "limited flexibility" to engage with Gopher under the terms of the sale and purchase agreement that it entered into with the consortium in May.
Gopher said it believes this "is an unusual constraint to have allowed given the other protections in place. As such, Gopher urges shareholders to vote against the consortium offer at the general meeting on 15th July 2021, in order to give the board the ability to consummate a transaction with Gopher."
It added: "Gopher considers its offer to be full and fair, representing appropriate value for the potential of the Finalto business and a clear and material valuation uplift for Playtech shareholders. Gopher reiterates that it is fully funded and is in a position to proceed immediately and expeditiously towards a consensual and recommended transaction."
Shares in gambling software development company Playtech closed up 3.1% at 443.80 in London on Friday.
By Lucy Heming;Â lucyheming@alliancenews.com
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