UK-based bookmaker William Hill has rejected a takeover offer from a consortium formed by online gambling operator 888 Holdings and Rank Group, the operator of Grosvenor casinos and Mecca bingo halls.

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The cash and stock offer was reportedly worth £3.2bn, with the bidders valuing the company at 365 pence a share.

“This conditional proposal substantially undervalues William Hill, is highly opportunistic and does not reflect the inherent value of the business,” said chairman Gareth Davis in a statement.

The two companies must now raise their offer if they intend to complete the deal.

This offer only adds to the pressure on William Hill, which, in July this year, replaced its CEO James Henderson after he failed to improve the performance of online betting operations.

The proposed deal is the latest in a line of deal-making in the sector as it is hit by higher taxes and stricter regulation. Paddy Power and Betfair have already combined and the pending merger of Ladbrokes and Coral is set to create one of the UK’s biggest bookmakers.