Billionaire investor Kenneth Dart has submitted his formal takeover bid for Evolution. However, this move is likely just a way for him to meet his legal responsibilities and does not constitute a real attempt to acquire the casino supplier. Shareholders appear to agree with this assessment, making the mandated takeover attempt exceedingly unlikely to succeed.
The Offered Price Is Rather Low
Candle Lake Ltd., Dart’s investment vehicle, announced a mandatory cash offer of SEK695 ($73) per Evolution share after its stake in the Swedish-listed gambling technology firm recently purchased 2.05 million Evolution shares, causing its stake to exceed 30%. However, Candle Lake has indicated that it has little interest in acquiring Evolution despite the offer. In the unlikely event that the bid does succeed, Evolution will be delisted from NASDAQ and go private.
Crossing the 30% barrier triggered Sweden’s mandatory bid rules, requiring Candle Lake to offer a bid for the rest of the shares. However, the chosen price was enough to deter most shareholders. Candle Lake’s offer was below Evolution’s recent market price of roughly SEK750 ($79). This fact makes a sale increasingly unlikely unless the company’s valuation plummets dramatically.
This situation is notable because crossing the 30% threshold sparked speculation that Dart could seek to gain control of Evolution. The company would represent one of his most expensive acquisitions at around $14 billion in market value. Instead, the actual offer, which hovers around the mandatory minimum, preserves his current position while satisfying regulatory rules.
A Takeover May Not Be Worth the Trouble
Dart’s stance is consistent with his investment history. The reclusive billionaire has generally leaned toward large minority stakes rather than high-profile corporate takeovers. Many of his investments have focused on companies in industries that attract significant public scrutiny, such as tobacco and gambling. So far, this strategy has paid off.
Dart maintains a significant presence in the gambling sector. Candle Lake is among the top shareholders in Flutter Entertainment, the company behind popular brands such as FanDuel. Evolution is another notable investment. Founded in 2006, the company has grown into one of the most well-known casino game providers worldwide, providing operators with table games and online iGaming products.
This move leaves Evolution’s leadership structure largely unchanged as Candle Lake will remain just a major shareholder. This could be perfect for Dart, who typically builds large stakes in companies he believes have long-term value. The alternative would be to assume the operational responsibility that comes with owning and running a global company, which may not be worth the hassle.