888 Holdings Regulatory News (888)

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION.

THIS ANNOUNCEMENT IS NOT AN ANNOUNCEMENT OF A FIRM INTENTION TO MAKE AN OFFER UNDER RULE 2.7 OF THE CITY CODE ON TAKEOVERS AND MERGERS (THE "CODE") AND THERE CAN BE NO CERTAINTY THAT AN OFFER WILL BE MADE, OR AS TO THE TERMS ON WHICH ANY OFFER WILL BE MADE.

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION

FOR IMMEDIATE RELEASE

15 August 2016

Statement regarding 888 Holdings plc and The Rank Group plc

The Board of William Hill PLC ("William Hill" or the "Group") confirms that, on 14 August 2016, it received an unsolicited non-binding highly conditional revised proposal (the "Revised Proposal") from 888 Holdings plc ("888") and The Rank Group plc ("Rank") (together the "Consortium") regarding a potential combination of the three companies.

The Revised Proposal comprises 199 pence in cash and 0.860 BidCo shares per William Hill share, and would result in William Hill shareholders owning 48.8% of the combined group. With the exception of William Hill shareholders' proposed ownership of the combined group, none of the other key terms of the Revised Proposal have changed from the original proposal of 8 August 2016. Based on the 22 July 2016 unaffected combined market capitalisation of the three companies adjusted for the cash component of the Revised Proposal1, this equates to an estimated value (before any synergy benefits) of 352 pence per share. The Consortium's previous proposal has an estimated value of 339 pence per share on the same basis. The Revised Proposal represents a premium of only 12% to the William Hill share price of 314 pence on 22 July 2016 (being the last trading day prior to the announcement of a possible offer by the Consortium).

Having reviewed the Revised Proposal with its financial advisers, Citi and Barclays, the Board of William Hill has unanimously rejected the Revised Proposal as it continues to substantially undervalue William Hill and as such the Board continues to see no merit in engaging with the Consortium.

The Board of William Hill continues to believe that the Revised Proposal is highly opportunistic and does not reflect the inherent value of the Group. Under the Revised Proposal, William Hill shareholders continue to be offered a substantial proportion of their consideration in highly leveraged BidCo shares and so it is directly relevant that the Board of William Hill continues to believe that a combination of William Hill with 888 and Rank will not enhance William Hill's strategic positioning or deliver superior value for shareholders compared against William Hill's strategy, which is focused on increasing the Group's diversification by growing its digital and international businesses.

In addition,

the Revised Proposal continues to present significant risk for William Hill shareholders as it involves a highly complicated three-way combination at a very low premium;

there is still substantial risk for William Hill shareholders in the achievement of the estimated future cost synergies, which are only expected to be achieved in full by the end of 2020; and

the Revised Proposal continues to result in the combined group operating with substantially increased leverage of approximately £2.2 billion, carrying a much higher interest charge.

Gareth Davis, Chairman of William Hill, said: "This revised proposal continues to substantially undervalue the company and the cash element of the proposal has not changed. Therefore, the Board sees no merit in engaging. As we have said before, this is highly opportunistic and complex and does not enhance the strategic positioning of William Hill. The Board continues to believe we have a strong team to deliver superior value to our shareholders and trading at the start of the second half gives us renewed confidence in our stand-alone strategy."

In accordance with Rule 2.6(a) of the Code, the Consortium is required, by not later than 5.00 p.m. on 21 August 2016 to either announce a firm intention to make an offer for William Hill in accordance with Rule 2.7 of the Code or announce that it does not intend to make an offer, in which case the announcement will be treated as a statement to which Rule 2.8 of the Code applies. This deadline can be extended with the consent of the Panel in accordance with Rule 2.6(c) of the Code.

This announcement is being made without the approval of the Consortium.

There can be no certainty that a transaction will be forthcoming or as to its terms. William Hill shareholders are strongly advised to take no action.

The person responsible for arranging for the release of this announcement on behalf of William Hill is Philip Bowcock.

Enquiries

1. Assumes a combined market capitalisation on 22 July 2016 (being the last trading day prior to William Hill entering an offer period) of £4,506m (of which William Hill is £2,761m, Rank is £926m and 888 is £819m). This combined market capitalisation is then reduced for the cash being paid to William Hill shareholders under the Revised Proposal of £1,752m. Of the resultant amount, 48.8% is attributable to William Hill Shareholders (£1,344m). This amount is divided by William Hill's fully diluted shares outstanding (880m) and then added to 199p to calculate the value to William Hill shareholders of the Revised Proposal. On 22 July 2016 the share prices of William Hill, Rank and 888 were 314p, 237p and 222p respectively. The fully diluted shares outstanding for William Hill, Rank and 888 is assumed to be 880m, 391m and 369m respectively.

This announcement is not intended to, and does not, constitute or form part of any offer, invitation or the solicitation of an offer to purchase, otherwise acquire, subscribe for, sell or otherwise dispose of, any securities whether pursuant to this announcement or otherwise. This is an announcement under Rule 2.4 of the Code and does not constitute an announcement of a firm intention to make an offer under Rule 2.7 of the Code.

The release, publication or distribution of this announcement in jurisdictions outside the United Kingdom may be restricted by law and therefore persons into whose possession this announcement comes should inform themselves about, and observe such restrictions. Any failure to comply with such restrictions may constitute a violation of the securities law of any such jurisdiction.

Citigroup Global Markets Limited, which is authorised by the Prudential Regulation Authority and regulated in the United Kingdom by the FCA and the Prudential Regulation Authority, is acting as financial adviser to William Hill and for no one else in connection with matters set out in this announcement and will not be responsible to anyone other than William Hill for providing the protections afforded to its clients or for providing advice in relation to matters set out in this announcement.

Barclays Bank PLC, acting through its investment bank, which is authorised by the Prudential Regulation Authority and regulated in the United Kingdom by the FCA and the Prudential Regulation Authority, is acting as financial adviser to William Hill and for no one else in connection with matters set out in this announcement and will not be responsible to anyone other than William Hill for providing the protections afforded to its clients or for providing advice in relation to matters set out in this announcement.

Disclosure requirements of the Code

Under Rule 8.3(a) of the Code, any person who is interested in 1% or more of any class of relevant securities of an offeree company or of any paper offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the offer period and, if later, following the announcement in which any paper offeror is first identified. An Opening Position Disclosure must contain details of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any paper offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 pm (London time) on the 10th business day following the commencement of the offer period and, if appropriate, by no later than 3.30 pm (London time) on the 10th business day following the announcement in which any paper offeror is first identified. Relevant persons who deal in the relevant securities of the offeree company or of a paper offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.

Under Rule 8.3(b) of the Code, any person who is, or becomes, interested in 1% or more of any class of relevant securities of the offeree company or of any paper offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree company or of any paper offeror. A Dealing Disclosure must contain details of the dealing concerned and of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any paper offeror, save to the extent that these details have previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 pm (London time) on the business day following the date of the relevant dealing.

If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an interest in relevant securities of an offeree company or a paper offeror, they will be deemed to be a single person for the purpose of Rule 8.3.

Opening Position Disclosures must also be made by the offeree company and by any offeror and Dealing Disclosures must also be made by the offeree company, by any offeror and by any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4).

Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Takeover Panel's website at www.thetakeoverpanel.org.uk, including details of the number of relevant securities in issue, when the offer period commenced and when any offeror was first identified. You should contact the Panel's Market Surveillance Unit on +44 (0)20 7638 0129 if you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure.

Publication on Website

In accordance with Rule 26.1 of the Code, a copy of this announcement will be published on the William Hill website (http://www.williamhillplc.com) by no later than 12 noon on 16 August 2016. The content of the website referred to in this announcement is not incorporated into and does not form part of this announcement.