Apollo Adds IGT’s Gaming and Digital Business and Everi in New Acquisition

Article by : Erik Gibbs Jul 30, 2024

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In a deal that reshapes the gaming and digital entertainment landscape, Apollo Global Management is working to finalize the acquisition of International Game Technology’s (IGT) gaming and digital business, as well as Everi Holdings Inc., in a transaction valued at approximately $6.3 billion. This strategic move by Apollo, a leading private equity firm, not only consolidates its position in the gaming sector but also signals a significant shift in the industry’s dynamics.

The acquisition, which was completed after surpassing initial merger plans between IGT and Everi, has been the subject of intense speculation and analysis by industry experts. Under the terms of the agreement, Apollo-linked funds will take over IGT Gaming, which includes both the gaming and digital segments, and Everi, effectively making them privately owned entities within a combined enterprise. The deal is expected to close by the end of the third quarter of 2025, pending regulatory approvals and the green light from Everi stockholders.

The financial details of the deal reveal that Everi stockholders are set to receive $14.25 per share in cash, a 56% premium over the company’s closing share price on the day before the announcement. IGT, on the other hand, will receive $4.05 billion in gross cash proceeds for its gaming division. The majority shareholder of IGT, De Agostini S.p.A., has committed to a minority equity investment in the new combined enterprise at the closing of the transaction.

This acquisition is the culmination of a strategic review process initiated by IGT last year, aimed at enhancing shareholder value and focusing on its core strengths. Vince Sadusky, CEO of IGT PLC, expressed that the agreement with Apollo represents a positive evolution from the previously announced transaction with Everi. He emphasized that the partnership with Apollo acknowledges the strength of IGT Gaming, the value of its talent, and its industry position.

Following the completion of the sale, IGT will undergo a rebranding, changing its name and stock ticker symbol to reflect its new focus as a premier pure-play lottery business. This move is indicative of IGT’s strategy to concentrate on its robust lottery operations, which have consistently shown growth and resilience in the face of industry challenges.

The transaction has been unanimously approved by a special committee of the IGT Board of Directors and by all members of the Everi Board of Directors. The previous transaction agreements between IGT and Everi, which were entered into earlier this year, have been terminated in favor of this new arrangement.

The implications of this deal for the gaming and digital business sectors are far-reaching. Apollo’s acquisition brings together two significant players in the industry, potentially creating synergies that could lead to innovative product offerings and enhanced customer experiences. It also reflects a broader trend of consolidation in the gaming industry, as companies seek to leverage scale and diversification to navigate an increasingly competitive market.

For Apollo, the acquisition is a testament to its investment strategy and its belief in the long-term growth potential of the gaming and digital sectors. The firm has a history of making calculated moves in various industries, and this latest acquisition is consistent with its approach of investing in companies with strong market positions and the potential for value creation.