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Amaya Gaming shares regain some lustre after company announces buyback plan

MONTREAL – Shares in Amaya Inc. regained some of their lustre Monday, closing up 12 per cent to their highest level since plummeting a month ago on news that Quebec’s securities regulator had launched an investigation into trading activity surrounding the acquisition of PokerStars.

The shares gained $3.25 to $30.40 on the Toronto Stock Exchange after the Montreal-based company announced it would buy back up to 5.4 million of its shares over the next year.

Amaya (TSX:AYA) said the move to repurchase about five per cent of its outstanding stock was made because it felt the current share price didn’t reflect the company’s underlying value.

The purchases will be funded with cash on hand and proceeds from divestments.

Before closing down 18 per cent on Dec. 12, Amaya’s shares had been on a tear, more than quadrupling to an all-time high of $39.25 in the wake of the US$4.9-billion PokerStars deal announced in June.

Meanwhile, Amaya said Monday that it is evaluating non-binding proposals to purchase its Cadillac Jack land-based gaming business.

The company has already sold Ongame Network Ltd., its poker and platform provider, to NYX Gaming Group Ltd. It also plans to consider opportunities to sell its other land-based gaming assets.

Neither Amaya nor the provincial regulator, l’Autorite des marches financiers, have provided details on the stock trading investigation.

Amaya’s headquarters in the Montreal community of Pointe-Claire, along with the offices of investment banker Canaccord Genuity and Manulife Financial (TSX:MFC) were searched RCMP and the provincial securities regulator. The national police force said it was simply providing security for the AMF.