Bally’s ongoing exposure to Japan’s online gambling market could become relevant as the group prepares to complete its acquisition of William Hill owner evoke through majority-owned subsidiary Bally’s Intralot.
The UK Gambling Commission will need to approve the transfer of evoke’s licences, making the buyer’s suitability part of the process.
Bally’s sold its Asian B2C division after investor pressure over its exposure to Japan. The business included Vera&John, CasinoSecret and Yuugado, brands that together would make it the current Japanese market leader based on Blask data reviewed by NEXT.io.
Japan had become a major part of Gamesys before Bally’s acquired the company in 2021. Vera&John entered Japan in 2012, when the legal position around offshore operators was less clear.
By 2019, East Asia accounted for 26% of Gamesys revenue, worth around £108m. Its 2020 report said: “This year we have been able to establish ourselves as the clear online casino market leader in Japan, with a strong growth trajectory.” By 2023, Japan represented 12% of Bally’s total corporate revenue.
Japan’s crackdown increased pressure for Bally’s to reduce direct exposure
Japan’s position hardened as authorities increased action against offshore gambling. In June 2022, then-Prime Minister Fumio Kishida said online casinos were illegal and called for stronger enforcement. Authorities also clarified that gambling from Japan could breach the Penal Code even when the operator was based overseas.
Illegal gambling arrests increased nearly 400% to 279 between 2022 and 2024. Japan strengthened the law again in September 2025 to explicitly prohibit online casino services to Japanese residents.
Investor K&F Growth Capital had raised concerns in April 2024 while opposing Standard General’s takeover of Bally’s. “It is also our belief that a US public company should not be in the business of supplying gaming equipment and operations to the Japanese market under the country’s current regulatory framework,” K&F wrote.
It recommended “a sale or structured separation of the International Interactive business”. Bally’s later sold the Asian operation to an unnamed buyer formed by members of existing management.
Sale structure allowed Bally’s to continue receiving licensing revenue
The transaction was completed for a €30m note. Bally’s recognised a $27.8m loss immediately, while much of the debt was later classified as unrecoverable. Its intellectual property was transferred to a new trust and licensed to the buyer, while Bally’s agreed to provide certain B2B services for a limited period.
“Bally’s will have no role in the management, operations, or governance of the carved-out business,” the company stated. “Going forward, the financial statements of the company will only reflect licensing and royalty revenues received from the buyer, which are expected to be lower than revenues under the current accounting treatment, but the profitability margins associated with those licensing revenues are expected to be higher as is customary in the gaming industry for IP license business models,” it added.
Bally’s also bought penny warrants representing a 19.99% fully diluted equity interest in the separated business. The carved-out operation generated $23m in licensing revenue for Bally’s in 2025, equivalent to about 4.6% of its $502.4m consensus EBITDA.
NEXT.io reported that the operating company behind the assets is Swedish-registered, Malta-based Silverspin AB, owned by Isle of Man company North South West Limited.
UK Gambling Commission could examine overseas exposure during suitability review
The structure could matter because the Gambling Commission considers activity outside Britain when assessing licence suitability.
Former Commission executive Tim Miller said in 2022: “…that doesn’t mean we should ignore what an operator who is licensed or based in our jurisdiction is doing elsewhere, especially if that calls into question their suitability to hold a licence.”
Former UKGC chief executive Andrew Rhodes later warned operators that overseas illegal gambling could affect their British licences. “Let me remind you that if an operator licensed in Great Britain is offering illegal gambling in another jurisdiction, any such findings may give rise to concerns relating to their suitability to hold a GB licence,” He wrote.
The Commission told NEXT.io: “We set out that we expect operators to comply with the law, both in the UK and in other jurisdictions in which they, or related companies, operate.
“Failure to meet this expectation may raise questions about the continuing suitability of licence holders.”
A compliance expert told NEXT.io that an investment or economic interest in an operation serving an illegal market could create integrity and suitability concerns, although the regulator would need to investigate the facts.
Former UKGC head of forensic accounting Stephen Spencer said a takeover triggers a change of corporate control test, with the Commission assessing whether the buyer would have been granted the licence in the original applicant’s position.
Bally’s Japan links also create pressure for the wider licensed sector
The Betting and Gaming Council has focused heavily on illegal gambling as UK operators face higher taxes and tighter regulation. Yield Sec data cited by NEXT.io estimates the black market has grown to around 9% of Britain’s total gambling market.
“We do not comment on the individual business activities of our members. Our position on illegal gambling in the UK is clear though: it puts consumers at risk and undermines the regulated sector,” the BGC told NEXT.io.
Campaigner and Gamban co-founder Matt Zarb-Cousin argued that members should be held to the same standard overseas.
“The Betting and Gaming Council is first to warn about the dangers of illegal gambling. The very least that ought to be expected of its members is ensuring they do not obtain revenues from jurisdictions in which they do not hold a licence. The Gambling Commission is investing considerable resources into tackling illegal gambling, it should also be holding its licensees to a much higher standard on this.”
The Commission has not indicated whether Bally’s Japanese exposure will affect the evoke transaction, and Bally’s did not respond to NEXT.io’s request for comment.
Bally’s sustained economic interest in its former Asian business has created an awkward suitability question as the evoke acquisition proceeds to regulatory review. The key issue is whether the UKGC will hold the company’s operations to the same standards in Japan.
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