IGT and Everi Announce Game-Changing Merger Plans
LISTEN TO THIS ARTICLE:International Game Technology (IGT) is set to merge its Global Gaming and PlayDigital divisions with Everi to enhance its offerings and form a globally comprehensive and diverse enterprise.
IGT has revealed that it will spin off its Global Gaming and PlayDigital businesses and merge them with Everi. Under the terms of the deal, IGT shareholders are expected to hold approximately 54% of the combined business shares, while Everi stockholders will hold the remaining 46%.
The Everi-IGT merger assigns an enterprise value of around $6.2 billion to the consolidated businesses.
The deal has gained unanimous approval from the boards of directors of both companies and is expected to close later this year or in 2025.
Combination of Two Robust Gaming Platforms
After the completion of the merger, Everi will undergo a name change to International Game Technology Inc. Additionally, it will be listed on the New York Stock Exchange under the ticker IGT.
Through the deal, the businesses aim to create an “all-in-one” store for their offerings. The merger is expected to result in the development of a "wide-ranging and diverse portfolio of successful land-based, digital, and fintech gaming products and services."
The transaction will combine two robust gaming platforms with complementary capabilities, geographic footprints and enhanced growth opportunities. It also facilitates the separation of IGT's Global Gaming and PlayDigital businesses from our Global Lottery business, resulting in a pure play global lottery business.
Financial Prospects of the Merger
The brands expect to make about $2.7 billion in revenue and around $1 billion in adjusted EBITDA in 2024. The merger will also save around $85 million in costs. Having a robust balance sheet will provide room for additional investments and returning of capital to shareholders.
The agreement is predicted to generate more than $800 million in adjusted cash flow annually in the second year. The estimated leverage ratio of net debt to adjusted EBITDA is projected to be between 3.2 and 3.4.
Deutsche Bank and Macquarie Capital will pledge $3.7 billion to the deal, along with a $500 million revolving loan facility. About $1 billion of the funds will be used to refinance Everi's current debt, while IGT will receive about $2.6 billion. The remaining funds will cover the financing fees of the merged businesses.
IGT’s Expectations
According to IGT, the deal will enable it to function as a specialized global lottery business with a concentrated and compelling business model supported by a top-notch team.
IGT will also be able to utilize its sales and distribution network to introduce Everi’s content and fintech solutions to customers beyond the United States.
Vince Sadusky, the CEO of IGT, will lead the merged company. Michael Rumbolz, current Everi's executive chairman, will assume the role of chairman of the board of directors.
We are bringing together two businesses with complementary strengths that are stronger and more valuable together. The combination results in a comprehensive and diverse product offering, addressing more aspects of the gaming ecosystem across land-based gaming, igaming, sports betting and fintech.
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