Evolution has terminated its planned acquisition of Galaxy Gaming, bringing an end to a two-year pursuit of the casino games supplier in a deal valued at around $85m.
Evolution gave notice of termination of the merger agreement this morning (21 July). It did not comment further on the decision but did say it expects to continue working with Galaxy within the framework of the companies’ existing “strong commercial relationship”.
In addition, in line with the agreement, Evolution will pay Galaxy a termination fee of $5.2m. Evolution declined a request from NEXT.io to comment further on the decision to terminate.
Termination comes after the agreed closing period for the merger expired on 17 July, the day Evolution published its Q2 results. This meant either Evolution or Galaxy were entitled to pull the proposed acquisition.
The deal, first announced in July 2024, was delayed by a prolonged regulatory review. It had been due to conclude last year but was extended in November 2025 to give regulators more time to analyse the merger.
The acquisition was first called into question by NEXT.io in January of this year.
Certain regulators had already signed off the merger deal, including the Mississippi Gaming Commission in the US. However, others – including Nevada – had not given the green light.
Speaking last week, Evolution CEO Martin Carlesund played down the impact of the deal potentially falling through. He said the merger would have “no material impact” in Evolution’s business, due to the size of Galaxy – but described the supplier as a “great company”.
“Due to Galaxy’s size, the transaction is not significant for Evolution,” Carlesund said. “The outcome has no material impact on our existing business, our US operations or our long-term ambitions.”
Regulatory approvals remained outstanding
While it is not yet clear whether regulatory issues alone were enough for Evolution to pull the plug on the merger, Galaxy confirmed in a statement that the merger was yet to secure the approvals of two gaming regulators. However, it stopped short of identifying these regulatory bodies.
There was some suggestion that the timing of Evolution’s licence review in the UK may have influenced the prolonged acquisition process. Analysts at Rothschild & Co Redburn said Nevada regulators could have been waiting for the outcome of the review before granting the approval, although neither regulator has publicly confirmed such a link.
Last week, Evolution confirmed its UK licence review will conclude with a £4.75m settlement paid to the Gambling Commission for supplying unlicensed UK-facing operators.
Galaxy upbeat on Evolution relationship
Galaxy’s statement was issued yesterday (20 July), ahead of Evolution terminating the deal this morning.
The supplier said it was “evaluating its options” – but with Evolution having now pulled the merger, Galaxy has seemingly been left with little option but to walk away with the $5.2m termination fee.
“For two years, we have been working with Evolution towards a closing of the merger agreement,” Matt Reback, president and CEO of Galaxy, said yesterday.
“During this same time, we have also been focused on growing Galaxy by increasing the range of our table games products, expanding into new markets, deepening partnerships with new and existing customers, increasing the share of our recurring revenues, and assembling a team of the highest calibre individuals possible.
“We are excited about the trajectory of the company, and we look forward to a continued relationship with Evolution.”
NEXT.io has contacted Galaxy for further comment.
