in a move poised to reshape the landscape of the gaming and fintech sectors, International Game Technology PLC (IGT) and Everi Holdings Inc. have announced a groundbreaking business combination. This merger is designed to weave together a diverse portfolio that spans high-performing land-based and digital gaming products, along with cutting-edge financial technology services.
The synergy between IGT and Everi’s offerings, enriched by their expansive global reach, promises a fertile ground for growth. It’s a collaboration that not only speaks to the companies’ complementary strengths but also to their collective potential in generating significant value for shareholders. With this merger, they stand at the threshold of an era marked by attractive recurring revenue and robust profit margins.
Leading the charge of the new enterprise will be IGT CEO Vince Sadusky, with a leadership team composed of executives from both entities. Everi’s Executive Chairman Michael Rumbolz is set to become the chairman of the board, ensuring a blend of vision and experience at the helm.
A noteworthy aspect of this transaction is the strategic separation of IGT’s Global Gaming and PlayDigital businesses, leading to a pure play global lottery business. This deliberate segmentation underscores a focused approach, aiming to optimize the capital structure and drive shareholder value.
London and Las Vegas have become the twin epicenters of this corporate union, signaling a merger that values the combined businesses at approximately $6.2 billion. The terms of the agreement denote that post-closing, IGT shareholders will own the majority stake, with Everi stockholders holding a significant minority. The boards of directors of both companies have unanimously approved this transaction, signaling a unanimous confidence in the deal’s strategic benefits.
The business combination is expected to carve out a one-stop-shop in the gaming landscape, covering everything from land-based gaming to iGaming, sports betting, and fintech solutions. Financial forecasts paint a promising picture, with projected pro forma revenue and Adjusted EBITDA for 2024 pegged at approximately $2.7 billion and $1 billion, respectively. The companies boast a sizable installed base of gaming machines, which guarantees substantial recurring revenues.
Strategically, the merger is anticipated to unlock premier intellectual property portfolios and facilitate the cross-pollination of content and financial solutions globally. It also aims to realize approximately $85 million in cost savings and operational efficiencies. The combined entity is set to benefit from a strong balance sheet and is expected to generate significant cash flows, allowing for strategic investments and enhanced stockholder returns.
This transaction is not just about numbers and forecasts; it’s about setting a new standard in the gaming industry. With an experienced team at the helm, the newly formed company aims to create a powerhouse that will cater to the evolving needs of gaming patrons worldwide.
As the industry sits on the cusp of this transformative merger, the implications for the gambling sector are profound. The combined company is positioned to accelerate innovation, streamline customer service, and expand its market share. This merger hints at a future where the gaming experience is more integrated, seamless, and enriched by technological advancements.
The expected closing of the deal in late 2024 or early 2025 is subject to regulatory approvals and the satisfaction of other customary closing conditions. This union heralds a new chapter in the gaming and fintech narrative, one that industry observers and stakeholders alike will watch with keen interest.
