William Hill rejects revised offer from Rank and 888
Bookmaker William Hill has rejected a revised takeover approach from 888 and Rank, saying it still "substantially" undervalues the company.
William Hill said the new proposal offered its shareholders an estimated value of 352p a share, compared with a previous offer of 339p a share.
Rank and 888 reaffirmed their view that the offer was "a compelling value creation opportunity for William Hill".
But William Hill said the revised offer was "highly opportunistic".
"The board continues to see no merit in engaging with the consortium," the company added.
The revised takeover proposal would see William Hill shareholders receive 199p in cash and 0.86 of shares in BidCo - the company being formed by 888 and Rank to buy William Hill - for each share they own.
William Hill shareholders would end up with 48.8% of the combined group.
Under the previous approach, William Hill shareholders were offered 199p in cash and 0.725 BidCo shares, leaving investors with 44.6% of the combined group.
"This revised proposal continues to substantially undervalue the company and the cash element of the proposal has not changed. Therefore, the board sees no merit in engaging," said William Hill's chairman, Gareth Davis.
"As we have said before, this is highly opportunistic and complex and does not enhance the strategic positioning of William Hill.
"The board continues to believe we have a strong team to deliver superior value to our shareholders and trading at the start of the second half gives us renewed confidence in our stand-alone strategy."
Casino and bingo hall operator Rank and online gambling group 888 said that the proposed new combination would create the UK's largest multi-channel gambling operator by revenue and profit.
They also said it would result in cost savings of at least £100m a year, while more savings could potentially be found "through constructive engagement".
However, William Hill has said the savings will not be achieved in full until the end of 2020 and pose "substantial risk for William Hill shareholders".
The chief executive of 888, Itai Frieberger, said a combined business could "lead innovation in the sector", while Rank chief executive Henry Birch said the deal made "compelling strategic sense for all three businesses".
The UK's second and third-largest retail bookmakers, Ladbrokes and Gala Coral, are currently proceeding with their £2.3bn merger, which will see them leapfrog over William Hill to become the country's biggest company in the sector.
The Competition and Markets Authority has told the two firms that they must sell 350 to 400 shops in order for the merger to be cleared.