Towards the end of April and after months of speculation, debt-laden evoke finally confirmed it was in talks to be acquired by Bally’s Intralot, with a potential 50p-per-share deal worth £225m on the table for the William Hill, 888 and Mr Green owner. While the deadline for agreeing terms has been extended from 18 May to 8 June, evoke – which is still saddled with £1.8bn of debt from the 2022 acquisition of William Hill’s non-US assets when credit was cheap – initiated a strategic review last December, with a full sale or a breakup of the firm both possibilities.
Evoke is particularly exposed to increased UK regulatory headwinds, most notably the near doubling of remote gaming duty (RGD) from 21% to 40% as of 1 April and the upcoming hike in remote betting duty from 15% to 25% from April 2027. Indeed, ‘UK Online’ accounted for more than a third (36%) of group revenue in 2025. UK retail was responsible for 28%.
The firm’s already depressed share price slumped to new lows of around 20p in the aftermath of November’s Budget – a far cry from the giddy heights five years ago of £4 a share – yet the stock has rallied slightly with news of Bally’s Intralot’s interest. Bally’s Intralot CEO Robeson Reeves was already framing his firm, which runs brands including Jackpotjoy, Virgin Games and Monopoly Casino, as a potential “great consolidator” before any tax rises were officially announced.
In Bally’s Intralot’s Q1 2026 results, the industry veteran referenced how 40% RGD had “changed the dynamics” of the UK and suggested tax hikes of this nature in other markets have historically driven consolidation, “benefitting higher-margin operators like Bally’s Intralot through expanded market share”.
Points of view
Now that the landscape has become decidedly dicey for many UK-licensed operators, how could consolidation impact the sector? For some, a potential wave of M&A activity is already underway. “The market’s already responding,” comments Ben Robinson, managing partner and founder of M&A and investment advisory firm Corfai. “Evoke is in play, Entain is under continued strategic pressure, and anyone carrying material UK casino GGR is feeling the squeeze.” Robinson believes more consolidation will come through 2026 and into 2027, along with a number of operators walking away from the UK because, simply put, “the maths no longer works”.
Others, however, are less certain of an immediate impact. For Ollie Chinneck, head of betting and gaming at accountancy and auditing firm BDO UK, evoke was an exceptional case: “Two-thirds of evoke’s business is UK-centric with a roughly 50-50 split between retail and online, so they’ve been very heavily exposed to the change in tax rates. “Given their debt mountain, I suspect this was the final nail for them. While some speculation is pointing towards this being RGD-related, there were already some underlying challenges there.”
Chinneck believes that while M&A is likely to ramp up in the mid-term, uncertainty over companies’ valuations will dampen deal volume in the coming months: “More broadly, I don’t think we’re going to see an immediate rush to consolidate, unless you have a firm with distressed assets which can’t absorb the immediate hit of the RGD changes.
“As for valuations, there is some uncertainty in the short term. Firms’ EBITDA will drop, and potentially EBITDA multiples too. This will cause hesitancy around deals.” Chinneck also argues those deals which do happen over the next 12 months will be “more contingent”, with an upfront amount paid initially and future payments based on asset performance. He adds that consolidation will take two to three years to really ramp up.
The view of Oscar Silver, investment analyst at independent gambling industry investment firm Waterhouse VC, lies somewhere in the middle. He says that while the current conditions don’t prevent M&A entirely, they lend themselves more to some types of deal than to others: “Fewer speculative transactions, more strategic acquisitions, and more structures involving equity, earnouts or lower upfront cash,” he notes.
So, while the big deals may have to wait, consolidation is ultimately inevitable given the current market conditions. Silver says: “This is a repeated pattern across mature, highly regulated markets. Pressure builds, the licensed market contracts, channelisation deteriorates, and tax revenue comes in below forecast. “We expect distressed M&A, asset sales and bolt-on acquisitions, with consolidation at the top, exits at the bottom, and a structurally larger unregulated market until offshore leakage is properly addressed.”
Longtail brands
But what of those businesses sat between top and bottom? What strategies can tier-two and tier-three business lacking the economies of scale to absorb the tax hikes employ to continue competing in the UK over the coming years? Indeed, Entain CEO Stella David reckons the “subscale operators”, as she referred to them during the company’s full-year 2025 earnings call in March, are “ill-equipped to withstand the impact”. Like rival Flutter, Entain expects to gain market share from the fallout.
While it’s just one company, Dave Matthews, CEO of tier-three operator BetWright, said in March that his company had amassed a sufficiently large customer base to survive the duty hikes and, therefore, wasn’t looking to exit the UK or sell up. Yet as Silver explains, the “subscale” firms will still have no choice but to become leaner and more efficient: “When marketing budgets compress, competitive advantage shifts from spend to product. That is where smaller operators have to fight. The broad, undifferentiated, mid-market model is the one that will struggle most, not just in the UK but across other regulated markets.”
Meanwhile, Robinson outlines three options for the mid-market operators. The first is M&A. “Consolidate to defend margin through scale, accepting that tier-two and tier-three operators are never going to match the advertising firepower of the global majors, but giving themselves a structurally more defensible cost base.”
The second is to rebuild how they run. The mid-market may have to embrace “leaner teams” and AI automation in departments like business intelligence, support and customer relationship management. Third, there is of course the option of “geographic rebalancing.” Instead of letting UK taxes eat away at earnings, multi-jurisdiction operators can reduce GGR as a share of group revenue – or leave the country altogether, as Lottomatrix and Small Screen Casinos have already done. “The fastest route out of a bad market is to be less exposed to it,” says Robinson.
Speaking of other geographies, Chinneck argues larger US operators could “take advantage of the UK landscape”. Even a business like bet365 could be up for grabs given reports last year the Coates family was weighing up a potential sale after speaking to Wall Street banks and other US-based advisers. A valuation of £9bn was previously banded about, yet that might be difficult to achieve given the regulatory pressures in the UK and the threat from prediction markets in the US where bet365 is live in 17 states.
On US firm’s potentially eying up the UK, Chinneck adds: “DraftKings, for example, don’t currently have a massive UK presence, and MGM may want some more scale to their UK business too.” Although the deal by Bally’s Intralot (created when Greek supplier Intralot bought the international digital gaming arm of US-based Bally’s last year for €2.7bn) was unique in Chinneck’s eyes, it still made sense for the acquirers as they were “already exposed to the UK taxes through their legacy Gamesys and Jackpotjoy ownerships – evoke will give them some more scale.”
Robinson concurs: “The strategic logic stacks up. Bally’s Intralot is already the UK’s number one online casino through Jackpotjoy, Virgin Games and Monopoly Casino. Adding William Hill and 888 builds dominant icasino scale at exactly the moment scale matters most under a 40% RGD.”
Ultimately, given that combinations of such magnitude are already happening, the outlook is not positive for those wishing to preserve a diverse market with an array of smaller-scale names. Chinneck even raises the possibility that only a handful of top UK operators survive the next five to 10 years. On how a Bally’s Intralot-evoke combination would reorder the market dynamic, Robinson says: “If they execute, the UK podium reorders sharply behind a dominant number one.”
The post Last ones standing: how UK gaming tax hikes could accelerate market consolidation first appeared on EGR Intel.
With Bally’s Intralot locked in discussions over a potential deal to acquire struggling evoke, could a fresh wave of M&A be about to sweep through the UK market?
The post Last ones standing: how UK gaming tax hikes could accelerate market consolidation first appeared on EGR Intel.