Evoke PLC, owner of the William Hill brand, is exploring a potential sale after facing a tough year marked by increased market pressures and a challenging new tax regime in the UK. This move comes as Evoke aims to navigate a landscape where the UK’s updated gambling tax policies threaten to significantly reduce their future profit growth.
On Tuesday, the London-listed company, formerly known as 888 Holdings, announced that it has engaged financial advisors Morgan Stanley and Rothschild to evaluate a variety of strategic options. These could include a full sale of the company or the divestiture of key assets. This news led to an 8% increase in Evoke’s share price in early trading, though it has experienced a drastic 70% decline since the UK government first indicated plans for significant tax hikes in August.
The significant change in financial dynamics is primarily due to Chancellor Rachel Reeves’ budget, presented in late November. The budget outlines that the remote gaming duty on online casinos and slots will nearly double from 21% to 40% by April 2026. Additionally, a new 25% remote betting duty will be applied to online sports betting, excluding horse racing, starting April 2027.
Given that Evoke’s portfolio is heavily skewed towards UK-facing online casino and betting services through its William Hill and 888 brands, the financial impact is particularly severe. The company’s statement, released alongside the review, projected that these measures could increase their annual duty costs by an estimated £125 million to £135 million, with approximately £80 million of this impact occurring in 2026 alone.
Evoke’s management has responded by revising its medium-term financial targets and signaled a need to reconsider its investment, marketing, and staffing strategies in the UK. As part of a broader mitigation strategy, the company has already indicated plans to reduce spending in the UK and execute potential job cuts.
Across the industry, the Office for Budget Responsibility (OBR) has predicted that the new gambling duties will generate around £1.1 billion in additional revenue by 2029–30. However, the OBR also recognizes the risk that increased prices and reduced payouts may push more consumers towards unregulated sites, potentially undermining the anticipated revenue gains.
This tax shock arrives amid existing financial strains from Evoke’s £2.2 billion acquisition of William Hill’s non-US business from Caesars in 2022. The acquisition was financed through the issuance of over £1 billion in new shares and approximately £900 million in additional borrowing, resulting in the group ending 2024 with a net debt of around £1.8 billion — over five times its underlying EBITDA.
Since the completion of this acquisition, Evoke has faced challenges in achieving its debt reduction targets, compounded by stringent regulations in the UK and Europe. The company has withdrawn or reduced operations in several “dot-com” markets, divested its US consumer business, and encountered regulatory scrutiny over past compliance issues, notably concerning legacy VIP practices at 888.
The plummeting share price has been equally dramatic. Evoke exited the FTSE 250 in 2023 and later disclosed it had turned down a £700 million takeover bid from Playtech, which valued its shares at 156 pence each — approximately six times the level they traded at before the recent market recovery.
The strategic review initiated by Evoke is already generating interest from potential buyers. CEO Per Widerström, who took charge last year with the mandate to stabilize operations and address the balance sheet, emphasized that the review was in response to “a materially changed fiscal environment” rather than an indication of a lack of long-term business potential.
Evoke’s brief statement revealed that the board would consider “all options,” which may include selling the entire company, forming minority or majority partnerships with strategic investors, or disposing of assets like the William Hill retail network or certain international online brands. Nevertheless, the company cautioned there is “no certainty that any transaction will ultimately be agreed.”
Industry analysts suggest that any prospective buyer must be comfortable with the new tax landscape and the existing leverage. Possible contenders might include rival operators seeking to expand their UK presence, private equity groups targeting distressed digital assets, or even land-based firms eyeing William Hill’s retail operations.
A London-based analyst remarked that Evoke represents “a classic case of a solid underlying franchise caught on the wrong side of regulation and leverage,” suggesting that the strategic review might be as much about compelling creditors and policymakers to acknowledge the repercussions as it is about entertaining acquisition offers.
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