Evoke, the London-listed gambling company that owns William Hill and the 888 online casino brand, has said it is considering a sale or breakup of the group, after warning of a £135m hit from tax increases announced in last month’s budget.

In a statement to the stock market, the heavily indebted company said it had appointed bankers at Morgan Stanley and Rothschild to explore potential options to secure its future.

The decision comes only four years after the business, then known as 888 Holdings, paid £2.2bn to buy William Hill’s network of 1,400 bookmakers, in an unexpected foray into bricks-and-mortar betting.

Shareholders have since watched the value of the company plummet by more than 90% to less than £100m as of Wednesday. The shares rose almost 9% after news of the potential sale or breakup.

One industry source said they did not believe there was much appetite for Evoke’s assets and speculated that bondholders might take control of the company and strip its assets, such as William Hill high street shops, to recoup some of their money.

Evoke, which is headquartered in Gibraltar, has net debt of £1.82bn.

Last month, after the chancellor, Rachel Reeves, announced significant increases in the duty levied on online sports betting and casino games, Evoke said it expected to pay extra tax of up to £135m a year.

It withdrew its medium-term financial targets at the time and said the decision would “drive customers to the black market, reduce overall tax generation, lead to thousands of job losses, and decrease investment in UK sports”.

On Wednesday, Evoke told investors it had “decided to undertake a review of the company’s strategic options, which will include the consideration of a range of potential alternatives to maximise shareholder value, including, but not limited to a potential sale of the group, or some of the company’s assets and/or business units”.

Reeves increased duty on online gaming from 21% to 40%, while duty on online sports betting was increased from 15% to 25%, with an exception for horse racing.

Evoke, founded in the late 1990s by a group of Israeli web tech specialists, said it would be hit hard by tax rises in the budget.

Its troubles have not been limited to external pressures, however, with a series of high profile compliance problems that have weighed heavily on the business.

In 2023, it removed its chief executive and suspended VIP customer accounts in the Middle East amid an internal investigation into a failure to follow anti-money laundering processes.

The company said certain “best practices have not been followed” in relation to “know your client” and anti-money-laundering regulations, sending its shares down by more than a quarter on the day.

A year earlier the company agreed to pay a £9.4m fine, then the third highest in the history of British gambling regulation, over multiple failings that led to customers racking up huge losses during the depths of the Covid pandemic.

In 2017, the Gambling Commission penalised 888 with a £7.8m fine, then a record, for “outrageous” failings, after more than 7,000 people who had voluntarily banned themselves from gambling were still able to access their accounts.

Evoke’s persistent underperformance led to an abortive attempt to take control of the company in 2023, fronted by Kenny Alexander and Lee Feldman, who previously ran Entain, the owner of Ladbrokes and Coral.

The backroom discussions that led to and ultimately scuppered that deal are now the subject of a civil lawsuit at the high court.

Alexander and Feldman claim the Gambling Commission breached their privacy, by causing Evoke to issue a stock market update about their proposed takeover.

In the update, 888 said the regulator was reviewing its licence to operate over concerns that Alexander and Feldman had presided over Entain during a period in which it was under investigation for alleged bribery in its Turkish operation.

In cross-examination, Feldman confirmed that he had been aware at the time of the talks with 888 that Alexander was a suspect in the investigation. Both men have since been charged with conspiracy to bribe and conspiracy to defraud.