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Apollo Private Equity granted approval to purchase IGT and Everi companies.

Apollo Global Management secures Nevada Gaming Commission approval for acquisition of IGT and Everi, valued at approximately $6.3 billion. Closing expected on Tuesday. With this deal, Apollo, proprietor of The Palazzo, Venetian, and Venetian Expo in Las Vegas, will acquire both companies.

,   and  ASMedia
3 min read
Apollo private equity granting approval for IGT and Everi acquisition.
Apollo private equity granting approval for IGT and Everi acquisition.

Apollo Private Equity granted approval to purchase IGT and Everi companies.

Unleashing the Gaming Titan

Get ready for some major shakeups in the world of gaming! Apollo Global Management, the powerhouse behind iconic Las Vegas hotspots like the Palazzo and Venetian, is about to reignite the industry with a bang. The gaming giants IGT and Everi are about to join forces in a whopping $6.3 billion deal, approved by the Nevada Gaming Commission. The deal sets to close on Tuesday.

This marriage of might aims to bring Apollo's gaming and digital business under one roof, consisting of IGT, Everi, and other assets. The company harbors dreams of launching an initial public offering (IPO) within the next three to five years, potentially under the new IGT banner.

Brin Gibson, legal counsel for Voyager Voteco LLC, explains the two-step transaction: first, the acquisition of IGT's gaming and digital assets. Then, the acquisition of publicly-traded Everi Holdings will follow. Voyager, owned by Apollo Managed Fund 10, Apollo co-investors, and a major IGT shareholder, the De Agostini family, is expected to bankroll the transitions. However, control will stay with Apollo partners.

Nicholas Khin, global gaming president for IGT, will don the interim CEO mantle. Hector Fernandez, former CEO at Aristocrat, will take the helm later this year, post his non-compete expiration. Daniel Cohen, Apollo partner, affirms their 20-year legacy in the gaming industry, boasting over 11,000 Nevada-based employees generating more than $2.5 billion in annual revenue.

Cohen outlines private equity investment as a strategy that rallies pension funds, institutional investors, endowments, and high net-worth individuals to fund businesses for long-term growth and eventual profit. As such, private equity doesn't prioritize short-term gains. Instead, the focus is on value creation, debt reduction, and delivering top-tier technology to customers, according to Cohen.

The new IGT will split into three divisions: digital, gaming, and fintech. Apollo aims to create a globally-dominant gaming technology platform, combining two powerhouse assets with complementary portfolios: gaming systems, fintech, iGaming, and payments. By bridging this gap, the company plans to unleash upside growth opportunities, improve product quality, and compete fiercely with Light & Wonder and Aristocrat.

The merged business anticipates $2.6 billion in annual revenue and $1.1 billion in EBITDA, with two-thirds coming from the existing IGT operations and one-third from Everi. The recurring revenue profile, boasting over 80% with recurring-like features, promises stability and a solid launching pad for investments and further growth.

Financing for the acquisitions will come from a mix of debt and equity. Apollo secured $4.3 billion in debt in early August, with the $20 billion Apollo Fund 10 pledging $1.3 billion and the De Agostini family investing $275 million, among other contributions. The new company will boast robust capitalization at close, with over $750 million in revolver, more than $400 million in cash, and over $1 billion in liquidity for speedy transformation initiatives.

With the dust settled since the merger was announced in July 2024, Apollo has been preparing both companies for integration and recruiting a skilled team to operate the business. The primary focus has been on assembling a management team that shares Apollo's vision for the future of IGT.

As the gaming scene evolves, consolidation is on the horizon. However, Cohen clarifies that the primary goal isn't redundancy elimination but recruiting talent and issuing stock to employees and management team members (approximately 7.5% to 10%). Under the new agreements, Everi shareholders will receive $14.25 per share in cash, marking a 56% premium over Everi's closing price on July 25, 2024. IGT stands to receive $4.05 billion in gross cash proceeds for its gaming division. IGT expects to use significant portions of the cash proceeds to repay debt and return money to shareholders.

  1. Despite the recent shakeups in the gaming industry, the merge of IGT and Everi, under the guidance of Apollo Global Management, is set to create a new force in sports technology.
  2. With the merged company's focus on creating a globally-dominant gaming technology platform, it's clear that sports are about to experience a new wave of innovation and competition.

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