Scientific Games joins legal battle against William Hill
Scientific Games has filed a lawsuit against William Hill in a Nevada court. The move comes after William Hill filed a lawsuit last week against NYX Gaming and its proposed merger with Scientific Games.
Scientific Games has claimed that William Hill’s actions amount to anti-competitive extortion and are coercive. Scientific Games has stated that it will seek damages for the costs incurred via the negotiations and legal representation so far.
Scientific Games has filed the lawsuit in Nevada. However, William Hill is seeking to have the legal action from this and its own lawsuit issued last week take place in the UK. This decision should be made this week.
Both NYX Gaming and Scientific Gaming appear very committed to moving along with the merger, despite the actions of Hill.
The lawsuit read:
William Hill has made its anti-competitive motives clear. In discussion after discussion with SG and NYX, William Hill expressed its view that the US sports betting market is a ‘two-horse race’ between William Hill and NYX, in which William Hill currently controls both horses. As William Hill puts it, the acquisition would cause William Hill to ‘lose one of its horses’, forcing it to operate in a competitive market.– Comapny statement, Scientific Games
Yesterday, it was announced that Scientific Games had acquired ownership of 11,600,000 ordinary shares – around 10.72% – in NYX Gaming, at a price of between AD$2.22 and CAD$2.35 per share, totaling an aggregated price of CAD$27,054,565. The press release made mention that should the planned merger not be approved, then Scientific Games would make a contractual takeover offer to the shareholders of NYX at the given share price.
Dispute on-going between the three companies
The on-going dispute began weeks ago when William Hill first expressed concerns about a proposed merger between NYX Gaming and Scientific Games. William Hill – who is a minority shareholder in NYX Gaming – claimed to find the commercial agreements as unfavourable. Due to this, Hill threatened to block the deal.
However, analysts pointed out that William Hill is likely concerned about its access to OpenBet, a technology provider for William Hill who was acquired by NYX Gaming last year, after William Hill provided £90m in investment. In the time since, William has stated that it is seeking to protect its relationship with OpenBet.
The UK based bookmaker demanded a formal vote on the merger, which would require converting its convertible preference shares in NYX to normal shares. To do so, William issued a formal legal complaint last week. A court recently ordered that NYX is not allowed to delay the date of the shareholder meeting where shareholders will vote on the acquisition.