Canadian online gambling operator Amaya Gaming has announced plans to sell off its stake in its former lottery subsidiary business Innova Gaming Group.
On Friday, Amaya announced that it had reached a support agreement with Canadian lottery services company Pollard Banknote Limited, which has made a C$42m unsolicited offer to acquire the Innova Gaming Group. Pollard has agreed to make an all-cash offer of no less than C$2.10 per share for Innova, and Amaya, which owns 8.18m shares (40.45%) of Innova, has pledged its support of Pollard’s bid.
Innova, which primarily provides technology to state and provincial lottery operations, was formed in 2015 when Amaya spun off its Diamond Game Enterprises subsidiary, part of Amaya’s wholesale divestiture of its B2B operations following the company’s 2014 acquisition of the Rational Group, the parent company of online poker giant PokerStars. Innova was designed to hold all Diamond Game shares ahead of a public floatation on the Toronto Stock Exchange.
Amaya offered the standard caveats that there was no guarantee that the deal would go through, and Pollard has until May 8 to formally make its share purchase offer/acquisition agreement.
The Innova sale is the latest step Amaya has taken recently to free up capital. Last week, the company refinanced its long term debt to waive its requirement to repay excess cash flow, which provided the company with the $48m it needed to make good on its deferred payments to the Rational Group’s former owners Isai and Mark Scheinberg.
Not to be outdone, Amaya’s former CEO David Baazov announced this week that he’d sold C$133m worth of his Amaya holdings to raise cash for “investment purposes.” Baazov, who stepped down from Amaya last year to deal with criminal charges of insider trading related to the Rational Group acquisition, saw his Amaya holdings reduced from around 17% to 12.1% as a result of the sale.