Undeterred by Snafus, David Baazov Gets Renewed Commitment From Amaya Bid Financiers

With the publicly expressed confidence of one of his  investors, ex-Amaya CEO David Baazov is back, with a renewed buyout proposal for the company he helped co-found.

Stanley Choi, chairman of Head and Shoulders Financial Group, told Bloomberg in a phone interview from Hong Kong that Baazov had his company’s “full support” and that he was “not at all” concerned by the KBC Aldini Capital controversy that hit the news late Friday.

David Baazov has since admitted that KBC, the firm he claimed was a financial equity backer for his $6.7 billion bid to acquire Amaya, had no knowledge of the deal.

In a Friday filing to the Securities and Exchange Commission (SEC), Baazov confessed that the equity commitment letter, which was supposedly from Dubai-based firm KBC Aldini Capital and carried a guarantee of financing for the proposal, was delivered without the firm’s “knowledge or consent.”

“KBC has not committed to provide financing for the proposed acquisition of Amaya,” it states. “KBC is not one of the Equity Financing Sources of the Proposed Transaction.”

The latest filing offers no further explanation for the bizarre events that unfolded last week, when KBC told a Globe and Mail newspaper reporter that it “didn’t know what Amaya was,” and had no involvement whatsoever with Baazov, despite being cited as having committed to financing to the multi-billion-dollar deal. KBC chief executive Kalani Lal said he had filed a complaint to the SEC.

Two of Baazov’s backers in the original filing, Hong Kong-based Head and Shoulders Global Investment Fund SPC and Goldenway Capital SPC, are reported to have increased their commitment to fill the shortfall. But Ferdyne Advisory Inc., a British Virgin Islands-based company, has also been mysteriously removed from the second filing, with no explanation as to why.

And that’s not the only controversy plaguing Baazov at the moment. He first announced his intention to take over Amaya in February of this year, just weeks before he was charged with five counts of securities fraud in his native Quebec.

The charges relate to alleged insider trading in the run up to several mergers and acquisitions within the online gambling industry, dating back to 2011. Baazov is alleged by Quebec securities regulator AMF of being the top of a pyramid that shared privileged information. It is also alleged that his actions allowed a close circle of family and friends to profit from illegal stock market trading.

Baazov has pleaded not guilty to each of the five counts, but is expected to go to trial. He faces up to five years in prison if found guilty.

The SEC will now be obliged to investigate the KBC complaint, in yet another probe that does not bode well for his Amaya takeover.