Apollo has announced an acquisition of Everi and IGT's gaming businesses in a deal valued at approximately $6.3 billion. Under this agreement, Apollo will spin off IGT's gaming division and merge it with Everi, a supplier specializing in casino technology and payments.
Everi shareholders are set to receive $14.25 per share in cash, reflecting a 56% premium above Everi's closing share price on July 25. Meanwhile, IGT will obtain $4.05 billion in cash as part of the transaction.
This acquisition coincides with an existing merger plan between IGT and Everi, which was revealed in February when IGT outlined intentions to combine its Global Gaming and PlayDigital divisions with Everi, aiming to form a more comprehensive global enterprise.
The agreement has gained unanimous approval from an IGT board special committee and is supported by Everi's board of directors, leading to the termination of the prior merger agreement between the two companies.
This earlier arrangement would have resulted in the combined entity being traded under the IGT name on the New York Stock Exchange. Instead, this new deal will result in the delisting of IGT, although the lottery business, which is not part of the current transaction, will continue to operate as a listed entity under a new brand. De Agostini SpA, IGT's former majority shareholder, will retain a minority stake in the new IGT-Everi business.
Daniel Cohen, a partner at Apollo, expressed confidence that the company will be better positioned under private ownership to exploit future opportunities for growth and value creation. He stated that the merger will result in a leading and diversified solutions provider well-integrated into the gaming ecosystem.
Originally, IGT's CEO Vince Sadusky was slated to lead the new company, but plans have since been revised. Sadusky will oversee the separation of the gaming operations and assist in managing the transition until the deal is finalized. He will continue as CEO of IGT’s lottery division post-deal. Everi's executive chairman, Mike Rumbolz, was expected to remain as chair of the merged entity; however, his name was not mentioned in Apollo's announcement.
Leadership roles for the newly formed IGT-Everi business have yet to be fully clarified, although IGT's executive vice president of strategy and corporate development, Fabio Celadon, will serve as chief financial officer, while Everi's CFO, Mark Labay, will take on the role of chief integration officer. The new company will be headquartered in Las Vegas.
Sadusky characterized the updated agreement as a "positive evolution" of the earlier deal, stating that Apollo recognizes the strength of IGT Gaming and the value of its talent. He noted that this arrangement will facilitate continued investment in key segments, enriching the portfolio available to customers.
Randy Taylor, president and CEO of Everi, reiterated that the modified agreement maintains the strategic rationale of the original merger while delivering "significant and certain value" to shareholders. He emphasized Apollo's respected reputation within the gaming sector and the firm’s awareness of the potential benefits of merging IGT Gaming and Everi.
Taylor also mentioned that operating under private ownership would better position the organizations to accelerate integration for the benefit of customers and employees alike.
Following the announcement, IGT plans to release its first half results and hold an investor call on July 30, while Everi will present its results by August 9, without a call scheduled. Following the news, shares of Everi surged 40.15% in pre-market trading to $12.81 per share, with IGT shares increasing 16.57% to $23.50 before market opening.
