Evolution Cancels Merger with Galaxy Gaming

Evolution has decided to cancel the merger agreement with Galaxy Gaming, a company specialized in table games and casino technology. This announcement comes after comments from Martin Carlesund, CEO of Evolution, who emphasized that the merger was not crucial for the business. As part of this cancellation, Evolution will pay Galaxy Gaming a termination fee of $5.2 million. Despite the cancellation, Evolution expressed its intention to continue collaborating with Galaxy Gaming under the current business relationship. In 2023, both companies signed a ten-year extension of their licensing agreement.

Evolution of the Merger with Galaxy

In the press release regarding the second-quarter results of Evolution, Carlesund hinted that the deal could be canceled once the closing period expired. "Two years have passed, and Evolution has invested significant time, effort, and resources in managing the necessary administration to close this acquisition," explained Carlesund. He added that, despite Galaxy being a large company, due to its size, the transaction is not relevant to Evolution and will not impact its operations in the U.S. or its long-term ambitions.

The merger was first announced in July 2024 when Evolution agreed to acquire all the shares of Galaxy Gaming in a deal valued at approximately $85 million. However, on Monday, Galaxy Gaming announced that two regulatory gaming approvals were still pending. Galaxy will evaluate whether to seek an additional extension to finalize the merger or to proceed with its own termination.

Financial Results for the Second Quarter

In the second quarter, Evolution's net revenues decreased by 1.2% year-on-year, reaching €517.8 million ($591.4 million), driven by a 3.7% decline in revenues from Asia. EBITDA also fell to €341 million compared to €345.3 million in the same quarter of fiscal year 2025. These reductions occurred despite growth in Europe, which had been facing several quarters of decline.

CEO Carlesund remained optimistic, highlighting that revenues and margins are improving compared to the first quarter, with strong cost controls and an increasing cash flow. Furthermore, he indicated that expansion in key markets continues while executing the product roadmap. "The path is almost never straight, but what matters is to keep moving forward," he added.

Evolution's decision to abandon the agreement represents a strategic step in its growth approach and resource optimization while keeping its existing business relationships with Galaxy intact.