Evolution Group Could Be Player in Live Dealer M&A, Says Research Firm
With its portion out of the US live dealer securities industry slipping, Evolution Group (OTC: EVVTY) could participate inward industry consolidation either as a emptor or seller.
That’s the use up of Eilers & Krejeck Gaming (EKG), which noted in a unexampled write up the Swedish fellowship is finding the US to follow a tougher marketplace amid escalating competition — a great deal of it attributable to Aristocrat Leisure.
The job looks to be to a greater extent on the slots side, with Evolution expression at its recent Q3 results it was ease growing inward Frederick North America live casino but non random number generators (RNG),” according to EKG. “The European human dynamo has antecedently looked to purchase its way of life come out of potentiality problems (see Ezugi inwards early-stage unrecorded casino inward the U.S. or NetEnt inwards Europe and Asia).”
The explore firmly noted International Game Technology’s (NYSE: IGT) net stage business could live an thought for Evolution if it’s looking for to bolster market apportion via acquisition. EKG also questioned whether or not it could be “Evolution’s bout to appear the like a takeaway target?”
IGT Unit Plausible Target for Evolution
IGT proclaimed in June that it’s mulling strategic alternatives for its planetary gaming and PlayDigital units. So, it’s non unreasonable that Evolution might deliberate an offering for the seller’s online arm.
In September, reports surfaced that Phoebus Global Management (NYSE: APO), among other unidentified suitors, is kicking the tires on IGT’s worldwide gaming business. A combining of Evolution and IGT inwards the live dealer infinite would make a behemoth as the deuce companies are the leaders as measured by 144 gaming revenue (GGR) by the supplier.
However, both are struggling with declining market share, potentially stoking worry among investors that “two wrongs don’t micturate a right.”
“Evolution is allay whirligig with a 21% share, but that is push down significantly from 28% inward Oct utmost year,” added EKG. “IGT has also seen its part go down inward that same period from 22% to 17%.”
Evolution Likely Sir Thomas More Buyer than Seller
With a securities industry capitalisation of around $19 billion, Evolution is likely to a greater extent purchaser than seller. Beyond Aristocrat and perhaps private equity firms, the pool of potential suitors for the Swedish accompany is shallow. Additionally, at that place are some moving parts involved in a potential takeover of Evolution that could piss such a dealing unattractive to prospective buyers.
But Evolution would in all likelihood need to split up cancelled its Asiatic and greyness securities industry operations to get that process and the only option that feels viable beyond that is buck private equity money that would presumptively looking at to ut a similar restructuring job,” EKG said.
Still, analysts expect the iGaming space, including live dealer concepts, is ripe for consolidation. It’s possible that an uptick inwards mergers and acquisitions inward the manufacture could obligate Evolution to volume upwards through and through acquisitions to ward turned unwanted advances.
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