William Hill's future in question after Rachel Reeves's £1.1bn gambling tax grab hammers sector

A sweeping strategic review, that could result in a sale, sent the firms' shares up more than 10 per cent on Wednesday morning.

The announcement comes less than two weeks after Chancellor Rachel Reeves unveiled a major rise in gambling taxes as part of her autumn Budget.

Evoke’s shares had fallen more than 36 per cent since the November 26 fiscal statement as investors assessed the impact of the higher duties. The company has appointed Morgan Stanley and Rothschild & Co as joint financial advisers to oversee the review.

Directors cautioned that the process may not lead to any transaction. The tax changes announced by the Treasury represent a substantial new financial burden for operators focused on the UK market.

Remote gaming duty, which applies to online casino products and slots, will rise from 21 per cent to 40 per cent from April 2026.

A separate duty on online sports betting will increase from 15 per cent to 25 per cent from April 2027, covering all sports except horse racing.

Evoke said in a profit warning published on Budget day that the combined measures would raise its duty costs by between £125million and £135million a year from 2027 without mitigating action.

The company generates roughly two-thirds of its revenue from the British market, leaving it more exposed than globally diversified firms such as Flutter and Entain.

Analysts have warned that the new tax regime could place further pressure on Evoke’s leverage position. Evoke’s share price has fallen by 60 per cent since January and reached a record low on Monday before rebounding following the review announcement.

Its market capitalisation has dropped to £94.3million, down from a peak of about £1.7billion in 2021. The business had already been facing challenges before the Chancellor announced the tax rises.

Its 2024 accounts reported a pre-tax loss of £168.8million. Jack Cummings, an analyst at Berenberg, said last month that Evoke’s high leverage would "come under scrutiny" as the new tax measures take effect.

Investors have judged that larger operators with substantial international income streams have greater ability to absorb additional duties.

Those firms could strengthen their market position if Evoke is unable to maintain its current scale. Evoke has said it plans to offset around half of the new tax burden through several measures.

These include closing some retail premises, making "changes to the customer proposition", securing savings from suppliers and reducing marketing costs.

Ahead of the Budget, Evoke indicated it might close up to 200 betting shops if gambling taxes increased, though the final number has not been confirmed.

Chief executive Per Widerström criticised the Government’s approach during the company’s profit warning, calling the policy changes "counter-productive and highly damaging".

The company had already withdrawn its medium-term financial targets and warned that thousands of jobs could be affected as a result of the fiscal changes.

Directors reiterated that the review remains ongoing and that "no certainty" exists that any sale or transaction will take place.