Evolution Board Tells Shareholders to Reject Candle Lake's SEK695 Bid

Evolution's board of directors has come out against Candle Lake Limited's mandatory cash offer of SEK695 per share, telling investors the price sits below what the live casino supplier is actually worth on the open market.

The recommendation follows Candle Lake's announcement on August 13 that it would put a formal offer to Evolution's shareholders. That step was not a matter of choice: once the vehicle pushed its direct holding past the 30% mark, Swedish takeover regulation obliged it to bid for the rest of the register. The acceptance period opened on August 17 and is scheduled to close around September 15.

Before reaching its conclusion, the board weighed Evolution's traded share price, its strategic and financial standing, the trajectory it expects the business to follow, and the opportunities and risks tied to that outlook. The verdict was blunt.

The statement was issued under Rule II.19 of the takeover rules for regulated markets set by Sweden’s Stock Market Self-Regulation Committee. The obligation to bid in the first place stems from Chapter 3, Section 1 of the Swedish Act on Public Takeovers on the Stock Market, the 2006 law that sets the 30% mandatory bid threshold.

The Numbers Behind the Discount

When Candle Lake first flagged that it had crossed the mandatory bid threshold, SEK695 was exactly where Evolution had closed on July 24, the final trading session before that disclosure. At the time the vehicle sat on approximately 30.02% of the shares and votes, and the price carried a slim 1.6% premium over the SEK683.8 volume-weighted average of the previous 20 sessions.

Evolution's stock did not stand still in the weeks that followed. By August 12 the shares had closed at SEK737.2, leaving the offer 5.7% adrift of the market. Measured against the 20-day volume-weighted average of SEK718.8 through the same date, the bid was 3.3% short. That gap is the core of the board's argument: shareholders would be selling at a haircut rather than a premium.

The gap widened further before the board spoke. Evolution closed at SEK787.60 on August 17, the day the acceptance period opened, and at SEK826.80 on August 24, when the recommendation was published. At that level the SEK695 offer stood roughly 16% below the market price.

The directors also drew attention to Candle Lake's own framing of the deal. The bidder has said it is not chasing full ownership; the offer exists because the regulation demands one.

Completion still depends on any regulatory, governmental or comparable clearances that apply. Candle Lake has indicated it expects the customary approvals to be in hand and believes the transaction can close once the acceptance period ends, without needing an extension.

A Full Takeover Is Not Off the Table

Even though the bidder insists it is not hunting for every share, it has left the door open. Candle Lake has said that if its stake climbs above 90%, it could move to a compulsory acquisition of the remainder — and that it would then look to take Evolution off Nasdaq Stockholm.

For the moment, the board's message to investors is simply to decline what is on the table.

How Dart Built His Position

Candle Lake’s path to 30% took about two years. Dart, a Cayman Islands-based billionaire whose family founded the foam-cup maker Dart Container, first disclosed a stake of about 5% in Evolution in August 2024. By February 2025 his holding had reached 15%, and later that year he became the company’s largest shareholder, lifting his exposure to 25.44% with the help of a swap agreement. On July 24, 2026 Candle Lake reported a direct holding of about 30.02% of shares and votes, which triggered the offer.

The investor is known for large, concentrated and often contrarian equity bets. Outside gambling, he holds sizeable positions in the tobacco groups Imperial Brands and British American Tobacco.

A Difficult Summer for Evolution

Founded in Stockholm in 2006 by Jens von Bahr and Fredrik Österberg, Evolution supplies live casino and online casino games to around 870 operators and employs roughly 22,900 people in studios across Europe, Asia and the Americas. The bid arrived during a busy few weeks for the company.

On July 15 it agreed a £4.75 million settlement with the UK Gambling Commission, closing a licence review that began in December 2024. The case centred on Evolution games being available to British players through six websites run by two operators without a UK licence, in breach of Evolution’s supply terms; the company said it cut ties with both operators as soon as it found out.

Two days later its interim report showed second-quarter net revenue slipping 1.2% to €517.8 million, with EBITDA of €341.0 million and a margin of 65.9%. Latin America grew 26.3% year on year and North America 9.5%, while Europe returned to quarter-on-quarter growth of 3.5% and Asia fell 3.7% from the previous quarter.

On July 21 Evolution gave notice that it was ending its merger agreement with Galaxy Gaming, a deal that had been pending for two years, and said it would pay Galaxy a termination fee of about $5.2 million while continuing their commercial relationship. At the same time the company has been buying back its own stock under a programme of up to €2 billion announced on May 18; by August 3 it held 5.01% of its own shares.

Dart's Widening Footprint in Gambling

The Evolution position is one piece of a much larger picture. Kenneth Dart's vehicle has been steadily accumulating stakes across the industry: roughly 29% of Flutter Entertainment, a 0.6% holding in Hacksaw Gaming — another Nasdaq Stockholm constituent — and, more recently, 5.8% of US operator DraftKings. Evolution remains the largest disclosed holding among them.

On the operational side, Evolution noted that Candle Lake has stated it has no present plans to make material changes to the business, its sites, its management or its workforce, including employment terms. The board said it takes those statements at face value and sees no reason to think otherwise.

Evolution has retained Gernandt & Danielsson Advokatbyrå as legal adviser on the offer. The bidder published its offer document on August 14, starting the clock on a decision shareholders must make by mid-September.