MONTREAL, Jan. 9, 2017 /CNW/ - Amaya Inc. (Nasdaq: AYA;
TSX: AYA) today announced its financing plan for the approximately
$197.7 million balance of the
deferred purchase price for its acquisition of the Rational Group
in August 2014, which is due on
February 1, 2017. All dollar ($)
amounts are in U.S. dollars.
After evaluating the multiple non-dilutive options available to
the company, Amaya has decided to pay the remaining balance of the
deferred purchase price over the course of 2017 from unrestricted
cash on its balance sheet and cash flow from operations. Amaya
believes this is the least expensive and most flexible financing
option at this time as it avoids, among other things, incurring
additional term debt, amendment fees and associated costs and
expenses.
"We believe that our current plan speaks to the strong cash flow
generation of our business model and will allow us to continue
investing in the success of our business while meeting our
pre-existing contractual obligations to the former owners," said
Rafi Ashkenazi, Chief Executive Officer of Amaya. "Based on our
operations and performance in 2016, we are confident in our ability
to repay the balance of the deferred purchase price in a timely
manner."
In connection with its current plan, Amaya has entered into an
agreement with the former owners of the Rational Group whereby the
former owners have agreed not to enforce during 2017 their right
under the original merger agreement to cause Amaya to use
commercially reasonable efforts to issue equity to finance any
outstanding balance of the deferred purchase price. In addition,
under the original merger agreement and as previously disclosed,
the former owners agreed not to enforce the payment of the deferred
purchase price prior to the maturity or repayment of the
acquisition financing. In exchange for the new agreement, on
February 1, 2017, Amaya will pay in
advance three-months of non-refundable late payment fees related to
the unpaid balance of the deferred purchase price at the rates
outlined in the merger agreement (monthly rate equal to 30 day
LIBOR plus 85 basis points until August 1,
2017 and then 30 day LIBOR plus 135 basis points
thereafter), with such fees to be credited against any late fees
incurred during such three-month period. Any additional fees
that may be incurred on the outstanding balance beginning on
May 1, 2017 will also be calculated
at the rates outlined in the merger agreement.
As previously announced, Amaya paid $200
million of the deferred purchase price in November 2016, resulting in approximately
$2.3 million in savings towards the
outstanding balance.
About Amaya
Amaya is a leading provider of technology-based products and
services in the global gaming and interactive entertainment
industries. Amaya ultimately owns gaming and related consumer
businesses and brands, including PokerStars, PokerStars Casino,
BetStars, Full Tilt, StarsDraft, and the PokerStars Championship
and PokerStars Festival live poker tour brands (incorporating the
European Poker Tour, PokerStars Caribbean Adventure, Latin American
Poker Tour and the Asia Pacific Poker Tour). These brands together
have more than 105 million registered customers globally and
collectively form the largest poker business in the world,
comprising online poker games and tournaments, live poker
competitions, branded poker rooms in popular casinos in major
cities around the world, and poker programming created for
television and online audiences. Amaya, through certain of these
brands, also offers non-poker gaming products, including casino,
sportsbook and daily fantasy sports. Amaya, through certain of its
subsidiaries, is licensed or approved to offer, or offers under
third party licenses or approvals, its products and services in
various jurisdictions throughout the world, including in
Europe, both within and outside of
the European Union, the Americas and elsewhere. In particular,
PokerStars is the world's most licensed online gaming brand,
holding licenses or related operating approvals in 16
jurisdictions.
Cautionary Note Regarding Forward Looking Statements
This news release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995 and
applicable securities laws. Forward-looking statements can, but may
not always, be identified by the use of words such as "anticipate",
"plan", "continue", "estimate", "expect", "may", "will", "project",
"predict", "potential", "targeting", "intend", "could", "might",
"would", "should", "believe", "objective", "ongoing" and similar
references to future periods or the negatives of these words and
expressions. These statements are based on management's current
expectations and are subject to a number of risks, uncertainties,
and assumptions, including market and economic conditions, business
prospects or opportunities, future plans and strategies,
projections, technological developments, anticipated events and
trends and regulatory changes that affect us, our customers and our
industries. Although Amaya and management believe the expectations
reflected in such forward-looking statements are reasonable and are
based on reasonable assumptions and estimates, there can be no
assurance that these assumptions or estimates are accurate or that
actual results will not differ materially from those expressed or
implied in forward-looking statements. Forward-looking statements
are inherently subject to significant business, regulatory,
economic and competitive risks, uncertainties and contingencies
that could cause actual events to differ materially from those
expressed or implied in such statements. Specific risks and
uncertainties include, but are not limited to, Amaya's plans and
ability to repay the deferred purchase price for the acquisition of
the Rational Group, and those identified under the heading "Risk
Factors and Uncertainties" in Amaya's Annual Information Form for
the year ended December 31, 2015 and
"Risk Factors and Uncertainties" and "Limitations of Key Metrics
and Other Data" in its Management's Discussion & Analysis for
the three and nine months ended September
30, 2016, each available on SEDAR at www.sedar.com, EDGAR at
www.sec.gov and Amaya's website at www.amaya.com, and in other
filings that Amaya has made and may make with applicable securities
authorities in the future. Investors are cautioned not to put undue
reliance on forward-looking statements. Each forward-looking
statement speaks only as of the date hereof, and Amaya undertakes
no obligation to correct or update any forward-looking statement,
whether as a result of new information, future events or otherwise,
except as required by applicable law.
SOURCE Amaya Inc.