Amaya Provides Update on Rational Group Deferred Payment
Amaya Inc, says it has reached agreements that will allow it to avoid issuing shares to pay the final $197.7 million owed for its 2014 purchase of the PokerStars online gaming business.
The Montreal-based company says the former owners of PokerStars have waived their right to require Amaya to issue stock in order to raise cash for a payment, which was due by Feb. 1.
In return for getting a relaxed payment deadline, Amaya has agreed to pay three months of late-payment fees in advance as well as the remaining balance outstanding in stages over the coming months.
Amaya — which has a stock market value of about C$2.8 billion based on its recent stock price — acquired PokerStars and other consumer online gaming businesses by purchasing the Rational Group for US$4.9 billion cash.
That deal included about US$400 million in deferred payments, later reduced by a US$200-million payment in November.
The Amaya board of directors had attempted a merger with British betting company William Hill PLC but said in October that it would remain an independent company and find a “non-dilutive” way to pay the remaining cash owed for PokerStars.
“Based on our operations and performance in 2016, we are confident in our ability to repay the balance of the deferred purchase price in a timely manner,” Amaya chief executive Rafi Ashkenazi said in a release Monday.