16th Jul 2015 13:50
LONDON (Alliance News) - Contracts-for-difference trader Plus500 Ltd on Thursday said its shareholders have approved the sale of the company to FTSE 250-listed gaming software and foreign exchange trading group Playtech PLC.
Plus500 said 93.4% of the votes cast at its special general meeting to vote on the Playtech deal were in favour of the offer, representing 71.8% of its total voting rights. The deal does remain dependent on securing the approval of regulators and of Playtech shareholders.
Playtech offer had faced opposition from Odey Asset Management LLP, which claimed the bid "materially undervalues" Plus500. "Even considering the current regulatory issues and near-term risks, we believe the intrinsic value of the business on a longer term view is materially higher than 400 pence," Odey said in a statement back in June.
Playtech welcomed the approval of its offer and said it looks forward to integrating Plus500 into its financials business, alongside TradeFX, which it acquired for EUR458 million in April.
Playtech's bid valued the company at GBP459 million, or 400 pence per share. The deal for Plus500, agreed in early June, came after Plus500 had battled through a torrid month in which it was forced to suspend UK customer accounts amid concerns about its anti-money laundering processes. It also had to defend its accounting policies and confirm that it had paid its dividends.
The concerns sent Plus500's share price tumbling, leaving it vulnerable to a takeover bid.
"We are delighted to have secured the support of Plus500's shareholders. The combination of TradeFX and Plus500 will enable us to apply our market-leading products and services to the enlarged financial trading business as we continue to execute our growth strategy for the group," said Mor Weizer, Playtech's chief executive.
Plus500 confirmed during May that the UK's Financial Conduct Authority required it to verify its customers in the UK and ask them for documentation in doing so. It also had to defend its accounting policies during the month, after it became a target for short-sellers who have questioned both its business practices and accounting. Also during May, the company had to confirm it had paid its final and special dividend following market speculation it had not done so, another contributor to its share price fall.
Last week, the company warned that it is still subject to a "high level" of regulatory scrutiny, as the contracts-for-difference platform provider pushed back the date by which it expects to be able to onboard new customers in the UK.
Plus500 also reiterated that it expects margins to be "significantly lower" in 2015, although revenue is to be "similar" to that recorded in 2014, as the group continues to spend money on attracting new customers.
Plus500 shares were down 0.5% to 386.25 pence on Thursday, while Playtech shares were down 0.1% to 880.50 pence.
By Sam Unsted; [email protected]; @SamUAtAlliance
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