Rank and 888 have walked away from talks with William Hill over a proposed three-way tie-up which could have created a gaming giant.

The two companies had made two approaches to William Hill, both exceeding £3 billion, but these were both rejected by William Hill’s board.

Itai Frieberger, chief executive of 888 Holdings, said: "We are disappointed that the board of William Hill did not share our vision of the combined businesses. We believe that there was compelling industrial logic for the combination of these highly complementary businesses."

A merger of the three companies could have created the UK’s largest multi-channel gambling operator at a time when consolidation within the industry is rife. Paddy Power combined with Betfair earlier this year, whilst Ladbrokes and Coral are on the verge of a £3.5 billion merger which looks to be close to completion any day now and GVC Holdings has taken over Bwin.party.