TPG Emerges as Major Financier in Bally’s Proposed Acquisition of Evoke
Introduction to the Evoke Acquisition
The gambling industry is witnessing a potential significant takeover as a prominent financing partner steps forward to support Bally’s proposed acquisition of Evoke. Evoke is the parent company behind well-known gambling brands such as William Hill and 888. This financial backing could considerably enhance the likelihood of the deal moving forward.
TPG Credit’s Role in the Deal
TPG Credit, a division of the global private equity firm TPG, is reportedly in negotiations to provide substantial funding, possibly reaching around GBP 800 million (approximately $1.07 billion), to facilitate Bally’s Intralot in acquiring Evoke. A portion of this financing would be allocated towards refinancing Evoke’s existing debts, which include a EUR 600 million bond issued last year as well as other borrowings like revolving credit facilities.
This support from TPG Credit is considered a pivotal development, as securing this kind of financing could significantly ease Bally’s Intralot’s efforts to finalize the acquisition amid Evoke’s ongoing financial and regulatory challenges.
Background on the Acquisition Effort
Bally’s Intralot, listed on the Athens stock exchange and formed through the merger of Bally’s International Interactive business with Intralot, has been pursuing an acquisition of Evoke for several months. Formal discussions between the two companies were confirmed earlier this year.
Evoke has faced various obstacles over recent times, including a heavy debt burden and the repercussions of recent UK gambling tax reforms. These regulatory changes are expected to have a profound impact on the company’s operations and could potentially lead to the closure of numerous betting shops nationwide.
Per Widerström, Evoke’s CEO, has openly criticized the increased taxes, labeling them as “counter-productive and highly damaging.” The company anticipates the tax adjustments will reduce its financial performance by about GBP 125 million (roughly $168 million), leading to the withdrawal of its medium-term financial forecasts.
Details of the Proposed Offer and Market Reaction
Bally’s Intralot has put forth a bid valuing Evoke at around GBP 225 million ($302.5 million), offering 50 pence per share. Despite this, investor sentiment remains cautious, as evidenced by Evoke’s share price closing at 37.9 pence on May 29, reflecting market uncertainty about the transaction’s completion.
Negotiations between the companies are described as “constructive,” with Evoke clarifying that the proposal is expected to be an all-share deal combined with a partial cash option.
The deadline for Bally’s Intralot to submit a firm offer is set for June 8, with the possibility of an extension if discussions continue.
