Reclusive Billionaire Kenneth Dart Triggers Mandatory $13.8B Bid for Evolution

Swedish gaming giant Evolution AB has received a $13.8 billion takeover offer from Kenneth Dart’s Candle Lake Ltd., though the reclusive billionaire is unlikely to actually acquire the company.

Under Swedish law, crossing a 30% threshold in a publicly traded company triggers a mandatory buyout offer. Candle Lake surpassed that mark in late July. However, market watchers doubt Dart wants full control: the offer represents just a 1.6% premium over the stock’s 20-day volume-weighted average price prior to July 24, and it sits below where Evolution shares currently trade.

Other analysts believe Evolution is likely to reject the acquisition offer. If that happens, Swedish law allows Candle Lake to continue gobbling up shares of the betting outfit for another year without making a fresh takeover proposal.

Candle Lake Admits It Doesn’t Want to Own Evolution

In a 10-page disclosure released Thursday, Aug. 13, Candle Lake made clear it does not want to own Evolution outright. The firm described its stake as a long-term investment and even praised current management.

Dart’s company also notes that the published offer is the result of the aforementioned Swedish law and that it’s not angling for an activist role at Evolution.

“Candle Lake’s plans for the future business and general strategy of Evolution do not currently include any material changes with regard to Evolution’s future operations,” according to the disclosure document. “The Offer will not affect Candle Lake’s operations. Candle Lake also has no plans to implement any material changes.”

Dart Is Also a Major Flutter Investor

Dart, who gave up his U.S. citizenship in 1994 for tax reasons, is worth an estimated $11.2 billion, according to the Bloomberg Billionaires Index. His equity holdings have long featured “sin stocks,” including tobacco and gaming names.

His name is familiar in wagering circles because in addition to his 30% stake in Evolution, Dart owns roughly 30% of FanDuel parent Flutter Entertainment (NYSE: FLUT) through swaps.

That Flutter stake is up significantly in a matter of months, indicating the reclusive billionaire has been buying the stock as it moves lower. A regulator filing out earlier this week indicates one of Dart’s holding companies entered into a total return swap agreement for 332,237 notional shares of Flutter.