Primary Preview: IGT Gaming Business, Everi $4.3B Loan & Bond Offering to Finance Acquisition by Apollo Receives Mixed Reviews From Investors

Market participants looking at more than $4 billion in loans and bonds financing Apollo’s $6.6 billion acquisition and merger of IGT’s gaming and digital business with Everi feel mixed about the offering, yet the wide pricing could entice some investors. Apollo is buying both Everi and IGT’s gaming and digital business and merging them into one company, currently referred to as Voyager.

Lead left arranger Deutsche Bank began marketing a $2.575 billion seven-year term loan B and $1.75 billion seven-year senior secured bond last week. Price talk on the loan is at SOFR+400 bps to 425 bps and 98-98.5 OID, while the bond is coming in the low-8% area, Octus, formerly Reorg, reported. Pricing on both instruments is expected later this week.

Investors looking at the merger believe it will succeed with high demand because the gaming sector, and slots specifically, have been issuers in the high-yield market for a long time. Comparable companies being used on the deal include Light & Wonder and AGS, according to an investor.

Octus’ primary analysis of the deal can be found HERE. Octus’ covenant analysis of the deal can be found HERE.

Wide pricing on the deal should also attract buyside participants, according to multiple sources. In a sign of how sentiment has changed in the leveraged finance market over the past month, one source noted that the loan was being shopped around at SOFR+225 bps before market volatility, yet current pricing seems much more fair.

Additionally, a source noted that another positive on Voyager’s deal is the fact that the combined Voyager unit will have recurring revenue, about 15%, from its gaming business.

Still, investors are weighing the risks of getting involved in Voyager’s deal as potential tariff policies have affected the leveraged finance market negatively. With a worsening economy, one investor said that this could eat into Voyager’s business, as EBITDA is down for the combined gaming unit.

Reported EBITDA for Voyager in the last 12 months is $765 million, while adjusted EBITDA is $948.5 million, according to sources. Additionally, Voyager is guiding to a pro forma adjusted EBITDA of $978.9 million, $1.119 billion including synergies, the sources added.

Leverage for Voyager based on adjusted-EBITDA is at about 4x, according to sources, while reported leverage is about 6x. S&P Global Ratings said in its rating note last week that its B rating reflects the “high leverage pro forma for the debt financing and financial-sponsor ownership,” noting that leverage will be elevated in the low-5x area in 2025.

Still, S&P expects Voyager’s leverage to improve in 2026 based on “assumed revenue and EBITDA growth as the company benefits from stable market share across its product portfolio, increased penetration in existing iGaming markets, and operating efficiencies from the integration of the merger.”

Other sources noted that high leverage and the large amount of speculative synergies are more causes of concern for potential buyside participants on Voyager’s deal because they represent significant execution and integration risk for Apollo. One investor noted they would feel better if the deal included an unsecured debt or second lien portion.

IGT is a global leader in gaming, with its business spanning lotteries, gaming machines and sports betting. Everi is a supplier of financial technology solutions to casinos.

In July 2024, IGT and Everi announced that they had entered into a definitive agreement whereby “IGT would separate the IGT Gaming business by way of a taxable spin-off to IGT shareholders and then immediately combine such business with Everi,” according to the press release. After the closing, IGT and Everi will be privately owned by Apollo Funds and part of one enterprise. The transaction is expected to close by the end of the third quarter.

Macquarie Capital, Deutsche Bank and Mediobanca are serving as financial advisors to IGT, and Sidley Austin, White & Case and Wachtell are serving as legal counsel to IGT. Global Leisure Partners LLC is serving as the exclusive financial advisor to Everi, and Houlihan Lokey provided additional financial advice to Everi’s board of directors. Pillsbury Winthrop is serving as legal counsel to Everi. Paul Weiss is serving as legal counsel to Apollo Funds.

Macquarie, Goldman Sachs, Wells Fargo, Barclays, BNP Paribas, Truist, Santander, Scotiabank, Citi, Jefferies, Key, Standard Chartered, Crédit Agricole, Morgan Stanley and SMBC are bookrunners on the deal, according to sources.

Moody’s Ratings, S&P and Fitch assigned B1/B/BB ratings to the combined company and B1/B/BBB- ratings to the debt facility.

Fitch said in its note that its BB rating reflects Voyager’s “broad diversification across business lines, product types and jurisdictions due to the combination of International Gaming Technology plc’s (IGT) Gaming & Digital business with Everi Holding Inc., which operates in both gaming and FinTech segments, driving scale, synergies, and cross-selling opportunities.” Additionally, Fitch expects the company’s free cash flow margin to “rise from low single digits to mid-single digits over the rating horizon, in part due to EBITDA elevation from nominal market volume growth across all segments and relatively stable capex.”

Everi’s 2028 loan was last quoted today at 100/100.5, according to Solve. Everi’s 5% 2029 bond was last quoted on May 5 at 100.55 to yield 4.515%, according to MarketAxess.

A list of Everi’s CLO holders can be found in Octus’ CLO Database HERE.

Deutsche Bank declined to comment. Apollo did not respond to a request for comment.