DEFA14A: Everi Holdings to be Acquired by Apollo Funds; Shareholders to Receive $14.25 Per Share

Everi Holdings Inc. will be acquired by a newly formed holding company owned by Apollo Global Management affiliates, with shareholders receiving $14.25 per share in cash.

Summary

• Everi Holdings Inc. is being acquired by a newly formed holding company owned by funds managed by affiliates of Apollo Global Management, Inc.
• The transaction is expected to close by the end of the third quarter of 2025.
• Everi shareholders will receive $14.25 in cash for each share of Everi common stock they own.
• Vested stock options will be cashed out at closing, with the payment equal to $14.25 per share minus the option exercise price, less applicable tax withholding.
• Vested out-of-the-money stock options will be canceled at closing for no consideration.
• Unvested RSUs will be converted into a cash award and retain the original vesting schedule.
• Unvested stock options will have their intrinsic value converted to cash, vesting and being paid pursuant to the original vesting schedule.
• Unvested out-of-the-money stock options will be canceled at closing.
• The transaction is subject to shareholder and regulatory approvals, as well as other customary closing conditions.

Sentiment

Score: 7

Explanation: The document is informative and outlines the terms of the acquisition. The sentiment is neutral to positive as shareholders are receiving a cash premium for their shares, but there are also potential downsides for option holders with out-of-the-money options.

Positives

• Shareholders will receive a cash payment of $14.25 per share, providing immediate liquidity.
• Vested stock options will be cashed out, providing additional value to option holders.
• Unvested RSUs and stock options will be converted to cash awards and continue to vest, ensuring employees retain some value from their equity grants.

Negatives

• Vested and unvested out-of-the-money stock options will be canceled at closing for no consideration, resulting in a loss for those holding such options.
• The transaction is subject to shareholder and regulatory approvals, and there is no guarantee it will be completed.
• Employees with unvested equity awards granted after December 31, 2024, will have their awards subject to partial proration at closing based on the timing of the closing.

Risks

• The transaction may not close if the required approvals are not obtained or if other closing conditions are not met.
• The announcement or failure to consummate the transaction could negatively affect Everi's stock price and operating results.
• There are risks related to retaining key personnel and potential business disruption following the announcement or closing of the transaction.
• The transaction involves significant costs, fees, expenses, and charges.
• The company faces risks related to competition, licensing arrangements, and economic changes in global markets.

Future Outlook

The transaction is expected to close by the end of the third quarter of 2025, pending shareholder and regulatory approvals and satisfaction of other customary closing conditions.

Industry Context

The gaming industry is seeing increased consolidation, with private equity firms like Apollo Global Management actively acquiring companies in the sector.

Comparison to Industry Standards

• The acquisition price of $14.25 per share will need to be compared to the trading multiples of other gaming technology companies to assess its fairness.
• Similar transactions in the gaming sector, such as the acquisition of Scientific Games' lottery business by Brookfield Business Partners, can provide benchmarks for valuation and deal structure.

Legal Proceedings

• The document mentions potential litigation related to the proposed transaction.

Stakeholder Impact

• Shareholders will receive cash for their shares.
• Employees will have their equity awards converted to cash awards.
• Customers and suppliers may experience changes as a result of the acquisition.

Next Steps

• Everi shareholders need to approve the proposed transaction.
• Regulatory agencies need to provide their approvals.
• The parties need to satisfy other customary closing conditions.

Key Dates

Keywords

acquisition, Everi Holdings, Apollo Global Management, shareholders, equity awards, stock options, RSUs, cash transaction, merger