Canada – Amaya to buy back stock and divest assetsBy Phil - 13 January 2015
Amaya Gaming is to buy back some of its own stock via a normal course issuer bid (NCIB) with the plan being to separate its B2B assets to focus on maximising its PokerStars brand.
Amaya said it will buy back and cancel up to 5,399,631 common shares, accounting for five per cent of the public float, over the coming year.
The company said in a statement: “Amaya believes that its current share price does not reflect the underlying value of the Corporation, and that purchasing shares for cancellation will increase the proportionate interest of, and be advantageous to, all remaining shareholders. The Corporation intends to buy back common shares for cancellation from time to time when it determines the price at which they are trading is undervalued and that such purchases provide the best use of available cash. The NCIB is subject to acceptance by the Toronto Stock Exchange and, if accepted, will be made in accordance with the applicable rules and policies of the TSX applicable. Common shares will be purchased through the facilities of the TSX at prevailing market prices at the time of purchase. In accordance with the applicable TSX rules, the maximum amount of daily purchases may not exceed 25 per cent of the average daily trading volume of the common shares, and the Corporation may make, once per calendar week, a block purchase of common shares not owned, directly or indirectly, by insiders of Amaya that exceeds the daily repurchase restriction.”
The Canadian-based operator and manufacturer has also finalised a plan to sell its B2B poker network Ongame Network to gaming solutions firm NYX Gaming Group.
The group advised: “Amaya made a strategic investment in NYX Gaming Group via a subscription of an unsecured convertible debenture, which matures two years after the date of issuance and bears interest at six per cent per annum, payable at maturity. Interest and principal are payable in kind in NYX Gaming Group common shares at Amaya’s option. On December 30, 2014, NYX Gaming Group announced that it had completed its initial public offering and its shares have started trading on the TSX Venture Exchange under the symbol The company is still seeking alternatives to its ownership of the Cadillac Jack B2B land-based slot manufacturer.
“Amaya has received and is evaluating non-binding proposals from certain persons. While discussions are ongoing, there can be no assurance that the Corporation’s strategic review process will result in the consummation of any specific action. There is no defined timeline for the strategic review,” it stated. “Further developments with respect to this process will be provided when, and if required. If a specific action is consummated that results in a divestiture, the Corporation intends to use the proceeds of such transaction to primarily facilitate the repayment of indebtedness. The corporation intends to explore various strategic opportunities to divest its other B2B assets. The intention is to examine strategic alternatives for these B2B assets that will maximize shareholder value by facilitating the repayment of indebtedness and/or the repurchase and cancellation of the Corporation’s common shares. There is no timeline for this process.”