Amaya keeps its cards close to vest

ONLINE GAMBLING Media barred from annual meeting

MONTREAL• Between Amaya Inc.’ s now former-CEO being charged with insider trading and his plans to take the company private, the world’s biggest online gambling company had an eventful year to talk about at its annual shareholder meeting on Tuesday.

Still, it preferred to keep all that to itself, banning media and non-share holders from attending the meeting at a downtown Montreal hotel where it, presumably, discussed the future of a company whose recent past has been full of both success and turbulence.

“It’s an interesting time for this company. It’s got great assets, controversy, a lot of value and a dominant business,” said Jason Ader, CEO of New York- based SpringOwl Asset Management as he left the meeting.

David Baazov, who left the role of CEO and took an indefinite paid leave- of-absence in March, also attended the meeting.

“I’m just a shareholder of the company in support of management ,” he said afterwards, declining further comment.

Baazov, 35, is actually Amaya’s largest shareholder — he owns more than 24.5 million shares or nearly 17 per cent of the shares in circulation.

Baazov said he took the leave to focus on charges laid against him by the Autorité des marchés financiers and prepare an offer to buy the company at a proposed $ 21 per share.

The company has said several potential buyers have entered into confidentiality agreements with Amaya and are conducting due diligence for a possible takeover.

“It either needs to be a good price, a price that’s a material premium from where it’s trading today, or we’ll vote against it,” Ader said.

This is the first time top executives of the PointeClaire, Que.- based company have met with shareholders since Baazov was charged.

He faces five charges, including influencing or attempting to influence the market price of the securi ties of Amaya and communicating privileged information, relating to the US$ 4.9- billion acquisition of PokerStars and Full Tilt from Oldford Group Ltd. in 2014.

Rafi Ashkenaz, who headed Amaya’s operating business — including the PokerStars and Full Tilt brands — has since taken over as interim CEO. He declined to speak with reporters following the meeting.

On Tuesday, the stock closed at $18.30, down eight cents or 0.44 per cent, in Toronto.

Shareholders who spoke with the Financial Post said Amaya management did not discuss the investigation or the takeover, and that there were no questions asked during the meeting’s question period.

“I wanted to know what was happening with the potential acquisition to take it private,” said one sharehold- er who did not want to be named. “That’s what I came here for.”

Several new people were nominated to join Amaya’s board, i ncluding Merrill Lynch veteran Alfred Hurley Jr. Neither Baazov nor chief financial officer Daniel Sebag ran for re-election.

Despite Baazov’s l egal issues the company’s recent financial performance has been stellar and it passed 100 million customers in early 2016.

Amaya earned $ 239 million on $ 1.37 billion in revenues l ast year, t urning around a loss of $7.5 million on $ 553.7 million in revenues a year earlier.

“I j ust want t o make money. I’m in it because I think i t’s undervalued; I think it’s worth way more than what the stock is trading today,” Ader said. “I believe you’re innocent until proven guilty, so let’s see what happens. But ultimately I don’t think this company’s licences should be put in jeopardy in any way, as a shareholder.”

Nonetheless, Ader says Amaya should not pay Baazov’s legal fees.

Baazov’s compensation surged 71 per cent in 2015, to about $1.04 million.

Baazov was c harged along with two other people and three companies following an investigation by the AMF into alleged insider trading.

They have all pleaded not guilty.

Their case is scheduled to be heard at a Quebec court on Sept. 7.

I THINK IT’S WORTH ... MORE THAN WHAT (IT’S) TRADING.