Amaya Gaming’s former CEO David Baazov has some new walking around money after selling nearly one-third of his stake in the online gambling company.
On Tuesday, Baazov (pictured) announced that he’d sold 7m Amaya common shares at C$19 apiece for a total consideration of C$133m (US $99m). The sale represents about 4.8% of the company’s outstanding common shares and about 30% of Baazov’s holdings in Amaya, the parent company of online poker giant PokerStars. Baazov still controls roughly 17.6m Amaya shares, equal to 12.1% of the company.
The market applauded the move, pushing Amaya’s stock price up 5.8% to C$20.06, the highest point the shares have traded on the Toronto Stock Exchange this year.
The sale came just days after Amaya announced that it had refinanced its long-term debt, a deal that included a requirement that the debt would become payable ahead of schedule if “a certain current shareholder” made further attempts to acquire the company. The poison pill was inserted “at the request of certain lenders.”
Baazov, who made a couple abortive attempts last year to acquire the company he used to run, was undoubtedly the unidentified shareholder in question. Certain other shareholders, including activist investor Jason Ader, have been urging Amaya to “fully move on from the undue influence” of their “discredited former executive.”
Baazov’s announcement cited “investment purposes” as the reason behind his decision to reduce his holdings but ‘legal fees’ could also be of rising importance, given that his trial on insider trading charges that is scheduled to get underway in November is expected to last up to 13 weeks.
Baazov stepped down as Amaya’s CEO last August, five months after Quebec’s securities regulator charged him with communicating privileged information related to Amaya’s $4.9b blockbuster deal to acquire PokerStars’ parent company in 2014. Baazov is also accused of using a front company to mask his trading activity ahead of the PokerStars deal.
If that wasn’t enough, Baazov is facing a separate investigation into an alleged sophisticated kickback scheme in which he was said to have provided a number of individuals – including his older brother Josh/Ofer Baazov – with advance knowledge of Amaya transactions, from which his co-conspirators reportedly reaped profits of at least $1.5m.
