Galaxy Gaming has taken a significant step forward as stockholders approved the company’s acquisition by Evolution Malta Holdings Limited, a subsidiary of Evolution AB, in a deal valued at approximately $85 million. This marks a key milestone for the company, which also reported a solid increase in its third-quarter earnings.
During a special meeting held on Tuesday, Galaxy Gaming shareholders gave their approval for the acquisition by Evolution. The deal, expected to close in mid-2025, is contingent on customary closing conditions and regulatory approvals. Following the completion of the acquisition, Galaxy Gaming will become a privately held company, and its shares will be delisted from public markets, ending its tenure as a publicly traded entity.
A Boost in Revenue Despite Losses
For the third quarter of 2024, Galaxy Gaming reported a 25% increase in revenue, reaching $7.7 million, compared to the same period in 2023. This strong growth demonstrates the company’s ability to generate higher earnings, even in a competitive and rapidly changing market.
However, despite the revenue boost, the company posted a net loss of $2.2 million. The loss was primarily driven by a 50% increase in selling, general, and administrative (SG&A) expenses, which Galaxy attributed to legal costs associated with the acquisition and increased internal labor expenses. The added expenses reflect the resources required to navigate the complexities of the acquisition process, as well as the rising operational costs tied to expansion.
Evolution’s Strategic Play
The acquisition deal has been closely watched within the gaming industry. Evolution AB, a global leader in gaming content and technology, sees this acquisition as a major move to bolster its already formidable portfolio. Evolution CEO Martin Carlesund expressed enthusiasm about the merger in July, emphasizing how Galaxy Gaming’s innovative products and technology align perfectly with Evolution’s existing offerings.
According to Carlesund, the acquisition will strengthen Evolution’s competitive edge by enhancing its ability to provide top-tier gaming experiences to customers. Galaxy’s renowned table games and its proprietary technologies complement Evolution’s own expertise, expanding its reach in the U.S. market and beyond.
The Future of Galaxy Gaming
Post-acquisition, Evolution intends to operate Galaxy Gaming as an independent business unit, retaining the company’s management and staff. This approach is designed to preserve Galaxy Gaming’s established brand identity while leveraging Evolution’s resources to accelerate growth in the competitive landscape.
The acquisition is part of Evolution’s broader strategy to solidify its position in the U.S. market, where demand for innovative online gaming products continues to grow. By acquiring Galaxy Gaming, Evolution strengthens its role as a leading licensor of proprietary table games, particularly in the expanding U.S. online gaming sector.
Looking Ahead to 2025
As the acquisition moves closer to its expected mid-2025 closing date, Galaxy Gaming remains focused on maintaining business continuity. The company’s management team is dedicated to driving growth in the interim, despite the increase in operational costs tied to the acquisition. The future looks bright for Galaxy Gaming, especially under the leadership and backing of Evolution AB, a company that has made its mark by acquiring and successfully integrating top gaming companies.
With a 25% increase in revenue and the approval of its acquisition deal, Galaxy Gaming is positioned to enter the next phase of its evolution, offering exciting prospects for employees, customers, and shareholders alike.
