In an effort to make his own iGaming company private, Amaya CEO David Baazov made a bid to take it off the public stock exchange.
On Monday morning Amaya released a statement saying that a group of investors and Baazov have made an offer to buy the company as well as its subsidiaries, such as PokerStars, for $15 per share.
For the Canadian Online gambling company, this bid comes in the aftermath of a turbulent period in the stock market.
In August 2014, PokerStars was acquired by Amaya for $4.4 billion, since then Amaya’s share price has dropped from $38 to $12.88. PokerStars’ delay in licensing its sports book section across territories and the strong US dollar contributed for Amaya’s loss of value.
Also, Amaya’s share price was affected by the lawsuit against PokerStars in the state of Kentucky. The site’s presence in Kentucky post-UIGEA made PokerStars liable for player refunds worth around $870 million.
This ruling had a negative effect on the company, even though PokerStars has challenged it. This is probably why Baazov and other investors made a bid for Amaya.
In the past many companies have used this tactic to manage tough times. In this case there is no evidence Baazov is bidding on Amaya, as an attempt to stop its price share from decreasing even more.
Compared to its iGaming peers, PokerStars could take more risks when it was a private entity, before being acquired by Amaya.
Recently PokerStars had issues with its daily fantasy sports site (DFS), StarsDraft. Thanks to the ongoing discussion about DFS being a game of “skill or luck” and the interpretation of many attorneys general that DFS is a game of luck, StarsDraft was shelved in all but four US stated last year.
As he moves back to America, Baazov may just see the advantage of not having to take into account shareholders. One thing PokerStars learned under the Scheinbergs’ leadership is that no good can come from ignoring the law.
Baazov is definitely going to follow the legal line, as a private or a public company.