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Apollo Global Management’s ambitious strategy to reshape the gaming supplier landscape achieved a crucial milestone this week as Nevada regulators granted initial approval to the private equity giant’s $6.3 billion acquisition of IGT Gaming and Everi Holdings. The unanimous endorsement by the Nevada Gaming Control Board represents one of the largest corporate mergers in gaming supplier history and positions Apollo to create North America’s dominant slot machine provider through strategic consolidation.
This transformative deal reflects Apollo’s systematic expansion across the gaming sector, where the firm has deployed over $20 billion since 2002 in pursuit of comprehensive market coverage. The complex transaction will merge two established gaming suppliers into a single privately-held entity that will retain the IGT brand while commanding unprecedented scale in the North American gaming market.
Key Takeaways
- Regulatory Milestone: Nevada Gaming Control Board unanimously approved Apollo’s $6.3 billion acquisition of IGT Gaming and Everi Holdings, marking a crucial step toward completion.
- Market Dominance: The combined entity will operate over 70,000 slot machines across North America, surpassing current market leader Light & Wonder’s 54,397 units.
- Financial Scale: Pro forma 2024 revenue of $2.6 billion and adjusted EBITDA of $1.1 billion positions the merged company as a gaming supplier powerhouse.
- Leadership Transition: Nick Khin will serve as interim CEO before Hector Fernandez assumes permanent leadership in Q4 2025, bringing proven gaming industry expertise.
- Strategic Integration: Apollo aims to create a comprehensive gaming supplier capable of meeting all operator needs from a single source.
- Timeline Pressure: The deal requires approvals from eight additional jurisdictions before the July 1, 2025 closing target.
- Industry Consolidation: The transaction exemplifies broader private equity-driven consolidation trends across the gaming supplier sector.
The Deal Structure: Creating a Gaming Goliath
Apollo’s acquisition strategy involves simultaneously purchasing IGT’s Gaming and Digital business for $4.05 billion and Everi Holdings for $2.25 billion, combining them into a single entity that will maintain the IGT brand identity. This structure allows Apollo to capture synergies between IGT’s global distribution network and Everi’s specialized financial technology solutions while preserving established market relationships.
Under the agreement terms, Everi stockholders will receive $14.25 per share in cash—representing a substantial 56% premium over the company’s July 2024 closing price. This premium reflects Apollo’s confidence in the strategic value of combining the two businesses and the competitive necessity of securing shareholder approval in a competitive M&A environment.
For IGT, the transaction enables the company to focus on its lottery and sports betting operations while providing capital for debt reduction and shareholder returns. The proceeds will be used strategically to optimize IGT’s remaining business lines and strengthen its balance sheet for future growth initiatives.
Unprecedented Market Scale
The merged entity will command impressive scale metrics that establish it as the clear leader in North American gaming supply:
- Combined installed base: Over 70,000 slot machines across North America, significantly exceeding Light & Wonder’s current 54,397 units
- Market position: Greater combined slots sales market share than either Light & Wonder or Aristocrat individually
- Geographic coverage: Comprehensive distribution network spanning all major North American gaming jurisdictions
- Product portfolio: Diversified offerings across gaming machines, systems, software, and financial technology
This scale provides several strategic advantages, including enhanced negotiating power with casino operators, improved operational efficiencies through consolidated manufacturing and distribution, and the ability to invest more heavily in research and development across all product categories.
Leadership Architecture and Strategic Vision
Apollo has carefully structured the leadership transition to ensure operational continuity while bringing proven gaming industry expertise to guide the combined entity. Nick Khin, currently IGT’s President of Global Gaming, will serve as interim CEO during the integration phase before transitioning to head the Global Gaming division when Hector Fernandez assumes permanent leadership in Q4 2025.
Nick Khin’s Industry Experience
Khin brings over 23 years of gaming industry experience to his interim CEO role, including significant leadership positions at Aristocrat where he successfully managed the company’s largest revenue-generating Americas division. His deep understanding of both supplier and operator perspectives provides valuable insight for navigating the complex integration of two established businesses with different cultures and operational approaches.
Nevada regulators praised Khin’s appointment during the approval hearing, highlighting his track record of successful strategic initiatives and comprehensive industry knowledge. His unanimous approval by the Gaming Control Board reflects regulatory confidence in his ability to lead the combined entity through its critical integration phase.
Hector Fernandez’s Strategic Leadership
The appointment of former Aristocrat Gaming CEO Hector Fernandez as permanent CEO signals Apollo’s commitment to industry-leading strategic vision. Fernandez brings extensive experience in gaming technology innovation, international market development, and operational excellence that will be crucial for maximizing the potential of the combined IGT-Everi platform.
Fernandez’s background at Aristocrat, where he successfully led the company’s global expansion and technology advancement initiatives, provides him with unique insights into the competitive dynamics and growth opportunities within the gaming supplier sector. His leadership will be particularly valuable as the combined entity seeks to leverage its enhanced scale to compete more effectively against established competitors.
Apollo’s Comprehensive Gaming Portfolio Strategy
The IGT-Everi acquisition represents the latest strategic move in Apollo’s systematic expansion across the gaming sector, where the firm has become one of the most significant private equity investors globally. Apollo’s current gaming portfolio demonstrates the firm’s commitment to building comprehensive platforms that can capture value across multiple aspects of the gaming ecosystem.
Existing Gaming Investments
Apollo’s gaming portfolio includes several landmark acquisitions that demonstrate the firm’s long-term commitment to the sector:
- The Venetian Resort Las Vegas: Acquired for $2.25 billion in 2022, representing one of the most significant casino acquisitions in recent history
- Great Canadian Gaming: Significant investment in Canada’s leading gaming operator
- Lottomatica Group: Strategic stake in Italy’s dominant lottery and gaming operator
- Multiple smaller gaming technology and service providers: Building a comprehensive supplier ecosystem
This diversified portfolio approach allows Apollo to understand the gaming industry from multiple perspectives—operators, suppliers, technology providers, and service companies—creating strategic insights that inform investment decisions and operational improvements.
Integrated Supplier Strategy
Daniel Cohen, Apollo’s gaming sector lead, articulated the firm’s ambitious vision during regulatory hearings: “Our goal long term is to become the operator’s supplier. So if you’re the Venetian or Caesars or anyone else, you can come to IGT for basically every one of your product needs.”
This integrated approach reflects Apollo’s recognition that gaming operators increasingly prefer working with suppliers who can provide comprehensive solutions rather than managing relationships with multiple specialized vendors. By combining IGT’s gaming machines and systems with Everi’s financial technology and operational services, Apollo creates a platform capable of addressing most operator needs through a single relationship.
The strategy also provides opportunities for cross-selling and upselling across the combined product portfolio, potentially increasing revenue per customer while reducing customer acquisition costs. This integrated approach has proven successful in other industries where private equity firms have consolidated fragmented supplier markets.
Market Dynamics and Competitive Positioning
The IGT-Everi combination directly addresses IGT’s competitive challenges in a market increasingly dominated by Aristocrat and Light & Wonder. These competitors have successfully captured market share through technological innovation, operational efficiency, and strategic geographic expansion, creating pressure on IGT’s historical market position.
Addressing Competitive Challenges
Apollo partner Daniel Cohen acknowledged during regulatory hearings that the combined business “has a margin profile that is significantly lower than our largest peers,” but expressed confidence that private ownership would enable the necessary investments to close the performance gap. This candid assessment reflects Apollo’s realistic understanding of the competitive challenges while demonstrating commitment to making the investments necessary for long-term success.
Private ownership provides several advantages for addressing competitive challenges:
- Long-term investment horizon: Freedom from quarterly earnings pressure allows focus on strategic initiatives that may take time to yield results
- Capital availability: Apollo’s substantial financial resources enable significant investments in research and development, manufacturing capabilities, and market expansion
- Operational expertise: Apollo’s portfolio of gaming investments provides insights and best practices that can be applied to improve operational performance
Revenue Diversification Benefits
Fitch Ratings highlighted the strategic benefits of combining IGT and Everi, particularly noting the enhanced revenue diversification that reduces dependence on any single product category or market segment. The diversified revenue structure positions the combined entity to weather market volatility more effectively:
- Gaming operations: 29% of revenue from recurring gaming machine placements
- Gaming sales: 23% from outright machine sales to operators
- Systems and software: 23% from technology solutions and ongoing support
- FinTech: 15% from Everi’s financial technology services
- Digital: 10% from online gaming and digital entertainment solutions
This diversification provides multiple growth opportunities while reducing the risk associated with concentration in any single revenue stream. The combination also enables cross-selling opportunities between IGT’s global distribution network and Everi’s specialized financial technology solutions.
Regulatory Approval Process and Timeline
While Nevada’s approval represents a crucial milestone, Apollo still faces the challenge of securing approvals from eight additional jurisdictions before the July 1, 2025 closing target. Each regulatory approval process involves detailed scrutiny of the transaction structure, leadership qualifications, and competitive implications.
Key Remaining Approvals
The most significant remaining regulatory hurdles include:
- Pennsylvania Gaming Control Board: Hearing scheduled for June 26, representing a key approval given Pennsylvania’s importance in the gaming market
- Nevada Gaming Commission: Final determination scheduled for June 26, following the Control Board’s recommendation
- Additional state and tribal gaming authorities: Various jurisdictions where IGT and Everi hold licenses or conduct business
Apollo officials have expressed confidence about receiving all necessary approvals within the target timeframe, citing extensive preparation and proactive engagement with regulatory authorities across multiple jurisdictions. The firm’s experience with gaming regulatory processes through its existing portfolio companies provides valuable expertise for navigating these complex approval requirements.
Integration Planning and Execution
Beyond regulatory approvals, Apollo faces the substantial challenge of integrating two established companies with different cultures, systems, and operational approaches. The firm has already begun detailed integration planning to ensure smooth combination of the businesses while maintaining operational continuity for customers.
Key integration priorities include:
- Technology systems consolidation: Merging different software platforms and operational systems
- Sales force integration: Combining field sales teams while maintaining customer relationships
- Manufacturing optimization: Consolidating production facilities and supply chains for improved efficiency
- Corporate culture alignment: Creating a unified culture that captures the best elements of both organizations
Industry Transformation and Future Outlook
The Apollo-IGT-Everi transaction occurs during a period of significant change within both the gaming industry and Nevada’s regulatory environment. These broader industry trends provide important context for understanding the strategic rationale and potential success of the combination.
Nevada Regulatory Leadership Transition
The approval comes during a period of leadership transition within Nevada’s gaming regulatory apparatus. Gaming Control Board Chairman Kirk Hendrick is stepping down after the June meeting, with former Gaming Arts CEO Mike Dreitzer assuming the chairmanship. This transition occurs as the industry grapples with unprecedented anti-money laundering enforcement actions that have resulted in over $24 million in fines this year alone.
The regulatory environment’s evolution toward more stringent enforcement and oversight requirements actually supports the strategic rationale for the IGT-Everi combination. Larger, well-capitalized suppliers are better positioned to invest in the compliance infrastructure and operational sophistication required to meet evolving regulatory expectations.
Private Equity Gaming Investment Trends
The IGT-Everi combination reflects broader consolidation trends across the gaming supplier sector, where companies seek scale and diversification to compete effectively in an increasingly sophisticated market. Private equity firms have deployed over $21 billion in gaming investments since 2018, with platform building through strategic acquisitions becoming the dominant investment strategy.
This private equity involvement brings several benefits to the gaming industry:
- Capital for innovation: Significant investment in research and development to drive technological advancement
- Operational expertise: Application of best practices from other industries and portfolio companies
- Long-term strategic focus: Freedom from public market short-term pressures enables focus on sustainable competitive advantages
- Consolidation efficiency: Ability to combine fragmented competitors into more efficient, larger-scale operations
Technology and Market Evolution
The gaming supplier industry faces significant technological disruption driven by digital transformation, mobile gaming growth, and evolving player preferences. The combined IGT-Everi entity will be better positioned to invest in and adapt to these technological changes through its enhanced scale and Apollo’s capital backing.
Key technological trends influencing the industry include:
- Digital integration: Seamless connection between land-based gaming machines and digital platforms
- Data analytics advancement: Sophisticated player behavior analysis and personalization capabilities
- Payment technology evolution: Enhanced financial technology integration for improved player experience
- Regulatory technology: Advanced compliance and monitoring systems to meet evolving regulatory requirements
Financial Implications and Value Creation Strategy
Apollo’s $6.3 billion investment in the IGT-Everi combination represents one of the firm’s largest gaming sector commitments and reflects confidence in the long-term growth potential of the combined entity. The transaction structure and strategic rationale suggest several paths for value creation over Apollo’s typical investment horizon.
Value Creation Opportunities
The combination creates multiple opportunities for value enhancement:
- Cost synergies: Elimination of redundant corporate functions, consolidated manufacturing, and optimized distribution networks
- Revenue growth: Cross-selling opportunities and expanded geographic reach
- Margin improvement: Operational efficiency gains and premium pricing for integrated solutions
- Market share gains: Enhanced competitive position against fragmented competitors
- Technology advancement: Increased investment in research and development enabled by improved scale
Private Equity Advantages
Private ownership provides several advantages for executing this value creation strategy:
- Investment flexibility: Ability to make substantial capital investments without quarterly earnings pressure
- Strategic patience: Long-term investment horizon allows for initiatives that may take several years to yield results
- Operational expertise: Apollo’s portfolio of gaming investments provides insights and best practices
- Exit optionality: Multiple potential exit strategies including strategic sale, IPO, or dividend recapitalization
Conclusion: A Defining Moment for Gaming Supplier Consolidation
Apollo Global Management’s $6.3 billion acquisition of IGT Gaming and Everi Holdings represents more than a significant financial transaction—it embodies a strategic vision for reshaping the gaming supplier industry through scale, integration, and operational excellence. The unanimous approval by Nevada regulators validates both the strategic rationale and Apollo’s capability to execute complex gaming industry transactions.
The combination creates North America’s largest gaming supplier by installed base, with over 70,000 slot machines and comprehensive product offerings spanning gaming machines, systems, software, and financial technology. This scale provides competitive advantages in an industry increasingly dominated by technological sophistication and operational efficiency requirements.
For the broader gaming industry, the transaction signals a new phase of supplier consolidation driven by private equity investment and strategic integration. As operators seek comprehensive solutions from fewer, more capable suppliers, the combined IGT-Everi entity positions itself to capture significant market share through its enhanced scale and integrated offerings.
The success of Apollo’s ambitious combination will depend on effective integration execution, regulatory approval completion, and the ability to leverage enhanced scale for competitive advantage. If successful, this transaction could serve as a template for further consolidation across the gaming supplier sector, potentially accelerating the industry’s evolution toward larger, more integrated platform providers.
As Apollo prepares to integrate two established suppliers into a single gaming powerhouse, the coming months will determine whether this bold strategic vision can deliver the operational excellence and financial returns that justify the substantial investment. For an industry experiencing rapid technological change and evolving regulatory requirements, the combined entity’s ability to adapt and lead may define the future competitive landscape for gaming suppliers across North America and beyond.
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