Evolution Ends $85 Million Galaxy Gaming Takeover After Approval Delays

Evolution has walked away from its planned $85 million acquisition of Galaxy Gaming, terminating the merger agreement after two outstanding gambling regulatory approvals failed to come through before the closing deadline. The Swedish live-dealer giant notified Galaxy Gaming of the termination and will pay the table games and casino technology supplier a $5.2 million breakup fee as part of the wind-down.

The collapse caps a deal that had been in limbo for two years, originally struck in July 2024 when Evolution agreed to buy every outstanding share of Galaxy Gaming in a transaction valued at roughly $85 million. The closing window on that agreement expired last Friday, and Galaxy Gaming confirmed the day before Evolution’s termination notice that the last two regulatory sign-offs still hadn’t materialized, leaving the companies to choose between another extension or scrapping the deal entirely.

Why the Deal Fell Apart

Regulatory approval has been the sticking point from the start. Casino and gaming technology acquisitions in the U.S. typically require sign-off from multiple state gaming commissions, and the process can drag on far longer than either party anticipates, especially for a supplier like Galaxy Gaming whose table games and equipment are licensed across numerous jurisdictions. With two approvals still pending well past the agreed timeline, Evolution opted to end the pursuit rather than push for yet another extension.

Evolution CEO Martin Carlesund downplayed the financial impact of walking away, framing Galaxy Gaming’s relatively modest size as the reason the outcome barely registers on Evolution’s broader balance sheet. “Galaxy is a great company; however, due to its 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.”

Notably, the two companies aren’t parting ways entirely. Evolution said it plans to keep working with Galaxy Gaming under their existing commercial relationship, which includes a 10-year licensing agreement extension the pair signed back in 2023. That arrangement stays intact even though the ownership deal is dead.

A Rough Quarter for Evolution

The termination lands just after Evolution posted second-quarter results that showed some cracks. Net revenue slipped 1.2% year-on-year to €517.8 million ($591.4 million), with Asia dragging the numbers down through a 3.7% regional decline. EBITDA came in at €341 million ($389 million), down from €345.3 million ($393.93 million) in the same quarter a year earlier.

There were bright spots buried in the report. Europe returned to growth after several straight quarters of shrinking regional revenue, climbing 3.5% from the prior quarter, and Latin America posted a strong 26.3% year-on-year jump. Carlesund pointed to those gains as evidence the business is stabilizing, noting that revenue and margin both improved versus the first quarter even as cost controls stayed in place and cash flow strengthened.

Carlesund said the company had poured substantial time and resources into clearing the administrative hurdles tied to the Galaxy Gaming acquisition over the two years it dragged on, effort that ultimately didn’t produce a completed deal. Even so, he emphasized that Evolution’s broader expansion plans and product roadmap remain on track despite the setback.

What It Means Going Forward

For Galaxy Gaming, the $5.2 million termination fee offers some consolation, and the continuation of its licensing partnership with Evolution means the table games supplier keeps a meaningful revenue stream even without the buyout. For Evolution, the failed acquisition is a reminder of just how unpredictable gaming regulatory timelines can be, even for a company of its scale that has closed numerous other deals in the space.

The episode also reinforces a broader trend in the casino and iGaming supplier market: consolidation remains attractive on paper, but regulatory friction across multiple U.S. jurisdictions can quietly stall or kill even modestly sized transactions. With Evolution now moving on and Galaxy Gaming continuing to operate independently, both sides appear positioned to keep growing their respective footprints in the online casino space without the deal’s uncertainty hanging over either company. Bettors and operators watching the online casino supplier landscape should expect Galaxy Gaming’s table games technology to remain part of the broader ecosystem regardless of the ownership outcome.