Advisors directly involved in negotiations between Bally’s and evoke remain confident the multi-billion-pound deal will ultimately be completed despite ongoing delays.
The sale of the William Hill operator represents the most significant pending gambling sector M&A agreement in Europe, delivering a British high-street stalwart into Bally’s hands.
Bally’s is a business widely known for aggressive cut-price deals, making this potential acquisition one of the most closely watched transactions in the industry.
Since news of the deal was first reported, the parties announced an extension of negotiations minutes before the initial deadline, pushing talks into the following month.
Despite that delay, sources directly involved in the process say there is little doubt the deal will eventually be approved, with complexity cited as the primary cause of hold-ups.
The two gaming giants are now edging closer to a new 8 June deadline without a confirmed agreement, which has caused anxiety in some quarters of the market.
Evoke shares have crept up closer towards the floated 50p offer price in recent weeks, though broader market scepticism about the deal has persisted throughout negotiations.
Private equity giant TPG was separately reported to be preparing up to £800m of financial support to help refinance evoke’s debt following any completed merger.
One investment source told NEXT.io: “You need space with investors, with shareholders – there is a number of things that you must do. So, I don’t see anything strange in them extending the deadline.”
If approved, shareholders will need to accept the near-total devaluing of the business, with the floated 50p per share offer putting the total price at just £225m.
Industry newsletter Earnings+More has highlighted that evoke’s founding Shaked family could prove a sticking point, having reportedly attempted to assemble a PE-backed counteroffer at one stage.
The central challenge remains evoke’s £1.8bn debt pile, which must be addressed despite the business’ assets reportedly being valued at significantly less than that figure.
One possible solution involves a Special Purpose Vehicle, or SPV, a financial structure that has been referenced in the Greek business press in connection with the deal.
Under such an arrangement, the SPV would receive preferred distributions from the combined group’s dividends, placing it first in line for any cash the business generates.
The SPV would be linked exclusively to evoke rather than parent company Bally’s Intralot, theoretically de-risking the transaction from Bally’s perspective by separating existing debt from its own leverage.
One sceptical expert source raised concerns about how much of the group’s free cash flow the vehicle would absorb, and what that would leave available for future growth investment.
“The first one that would need to be paid is going to be the SPV,” the source, who spoke under condition of anonymity, told NEXT.io. “Even if you spread the interest over 20 years, it is simply not a small number.”
“It feels like a well-engineered transaction between banks rather than between operators. If you are an operator, it looks like some bank with a smart idea.”
Details of the SPV structure have not been officially confirmed by either party, and the clock continues to tick toward the revised 8 June deadline for a final agreement.
The outcome of this deal is being watched closely across the European gambling sector, with the stakes high for evoke shareholders, creditors, and the future of one of Britain’s most recognisable betting brands.
