Australia's Tabcorp Holdings (TAH) on Thursday evening purchased control of a 9.9 percent stake in its takeover target Tatts Group for about A$639 million, said a source familiar with the situation.
The shares were bought at A$4.35 each through a cash-settled equity swap with UBS that gives Tabcorp voting rights, with the deal meant to make it harder for an interloper to break up an agreed merger between the pair, the source told Reuters.
Tabcorp could not be reached immediately for comment. Tabcorp, Australia's biggest bookmaker, last month agreed to acquire lottery operator Tatts for A$6.4 billion to create a gambling powerhouse in an effort to fend off a growing challenge from overseas online rivals.
The merger, which remains subject to approval from Australia's competition regulator, is being done via a scheme of arrangement. That will require the approval of 75 percent of Tatts shareholders.
