UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D

Under the Securities Exchange Act of 1934

(Amendment No. __)*

Luke L. Alvarez

250 West 57th Street, Suite 2223

New York, New York 10107

(646) 565-3861

with a copy to:

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§ 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box.¨¨

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See § 240.13d-7 for other parties to whom copies are to be sent.

*The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

Item 1. Security and Issuer.

This Schedule 13D (“Schedule 13D”) relates to the common stock (the “Common Stock”) of Inspired Entertainment, Inc. (formerly known as Hydra Industries Acquisition Corp.), a corporation formed under the laws of Delaware (the “Issuer”), whose principal executive offices are located at 250 West 57th Street, Suite 2223, New York, New York 10107. This Schedule 13D is being filed as a result of the change in the percentage of outstanding shares of Common Stock beneficially owned by the Reporting Person solely as a result of the change in the number of outstanding shares of Common Stock, first reported by the Company in its Post-Effective Amendment No. 1 to Form S-3 on Form S-1 Registration Statement and filed with the Securities and Exchange Commission on December 29, 2017.

Item 2. Identity and Background.

This statement is being filed by Luke L. Alvarez (the “Reporting Person”). Mr. Alvarez is a citizen of the United Kingdom and a resident of Gibraltar. His business address is c/o Inspired Entertainment, Inc., 250 West 57th Street, Suite 2223, New York, New York 10107. Mr. Alvarez is the Chief Executive Officer and President, and a director, of the Issuer.

During the last five years, the Reporting Person: (i) has not been convicted in any criminal proceeding (excluding traffic violations or similar misdemeanors) and (ii) was not a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.

Item 3. Source and Amount of Funds or Other Consideration.

Mr. Alvarez holds (i) 926,272 restricted shares of Common Stock which were granted to Mr. Alvarez pursuant to the Inspired Entertainment, Inc. 2016 Long-Term Incentive Plan and (ii) 150,720 shares of Common Stock, which Mr. Alvarez subscribed for at a price of $10.00 per share.

Item 4. Purpose of Transaction.

The acquisition of securities set forth in this Schedule 13D is for compensation purposes and in connection with an award granted to Mr. Alvarez. Except in Mr. Alvarez’s capacity as the Chief Executive Officer and President, and a director, of the Issuer, the Reporting Person has no present plan or proposal which would relate to or result in any of the matters set forth in subparagraphs (a) - (j) of Item 4 of Schedule 13D except as set forth herein. The Reporting Person reserves the right to increase or decrease his position in the Issuer through, among other things, the purchase or sale of securities of the Issuer on the open market or in private transactions or otherwise, including the exercise of warrants, on such terms and at such times as the Reporting Person may deem advisable. The Reporting Person reserves the right to change his intention with respect to any and all matters referred to in this Item 4.

Item 5. Interest in Securities of the Issuer.

(a)-(b) The aggregate percentage of shares of Common Stock reported owned by the Reporting Person is based upon 21,478,775 shares of Common Stock outstanding as of January 16, 2018, as reported in the Prospectus Supplement to Form S-3 on Form S-1 filed by the Issuer with the Securities and Exchange Commission on January 16, 2018.

The Reporting Person may be deemed to have sole beneficial ownership of an aggregate of 1,076,992 shares of Common Stock, or approximately 5.0% of the outstanding shares of Common Stock.

The filing of this Schedule 13D shall not be deemed an admission that the Reporting Person is, for purposes of Section 13(d) of the Act, the beneficial owner of any securities of the Issuer he does not directly own. The Reporting Person specifically disclaims beneficial ownership of the securities of the Issuer reported herein that he does not directly own.

(c) There have been no transactions in the class of securities reported on that were effected within the past sixty days.

(d) Not applicable.

(e) Not applicable.

Item 6. Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer.

Except as otherwise set forth herein and elsewhere in this Schedule 13D, there are no contracts, arrangements, understandings or similar relationships existing with respect to the securities of the Issuer between the Issuer and the Reporting Person.

Grant Agreement

The 926,272 restricted shares of Common Stock issued to Mr. Alvarez were granted pursuant to a grant agreement, a form of which is attached hereto as Exhibit 99.1. Mr. Alvarez currently has voting power over all such shares. Such shares vest in three equal installments, as follows:

If a specified price threshold has not been achieved prior to a scheduled vesting date, the portion of the award subject to that price threshold will vest on the first date thereafter when that price threshold is achieved, provided that any unvested units shall expire on December 23, 2021 if a specified price threshold has not been reached by such date.

Subscription Agreement

On December 29, 2016, pursuant to compensation arrangements with the Issuer, Mr. Alvarez agreed to use 50% of his cash bonus to subscribe for 150,720 shares of Common Stock at a price of $10.00 per share. Mr. Alvarez and the Issuer entered into a subscription agreement in connection therewith, a copy of which is attached hereto as Exhibit 99.2.

Lock-Up Agreement

In connection with a public offering (the “Public Offering”) by certain stockholders of the Issuer, in which Morgan Stanley & Co. LLC (“Morgan Stanley”) acted as underwriter, on January 15, 2017 Mr. Alvarez entered into a lock-up agreement, pursuant to which Mr. Alvarez agreed, subject to certain exceptions, not to (1) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any shares of Common Stock beneficially owned by Mr. Alvarez or any other securities so owned convertible into or exercisable or exchangeable for Common Stock or (2) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of Common Stock, until 90 days after the date of the final prospectus relating to the Public Offering. A form of the lock-up agreement is attached hereto as Exhibit 99.3.

Item 7. Material to be Filed as Exhibits.

SIGNATURES

After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.

DATE:   January 23, 2018

Attention:  Intentional misstatements or omissions of fact constitute Federal criminal violations

(See 18 U.S.C. 1001)

EXHIBIT 99.3

FORM OF LOCK-UP LETTER

January ____, 2018

Morgan Stanley & Co. LLC
1585 Broadway
New York, NY 10036

Ladies and Gentlemen:

The undersigned understands that Morgan Stanley & Co. LLC (“Morgan Stanley”) proposes to enter into an Underwriting Agreement (the “Underwriting Agreement”) with Inspired Entertainment, Inc. (f/k/a Hydra Industries Acquisition Corp.), a Delaware corporation (the “Company”), providing for the public offering (the “Public Offering”) by the several Underwriters, including Morgan Stanley (the “Underwriters”), of shares (the “Shares”) of common stock, par value $0.0001 per share, of the Company (the “Common Stock”).

To induce the Underwriters that may participate in the Public Offering to continue their efforts in connection with the Public Offering, the undersigned hereby agrees that, without the prior written consent of Morgan Stanley on behalf of the Underwriters, it will not, during the period commencing on the date hereof and ending 90 days after the date of the final prospectus (the “Restricted Period”) relating to the Public Offering (the “Prospectus”), (1) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any shares of Common Stock beneficially owned (as such term is used in Rule 13d-3 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), by the undersigned or any other securities so owned convertible into or exercisable or exchangeable for Common Stock or (2) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the Common Stock, whether any such transaction described in clause (1) or (2) above is to be settled by delivery of Common Stock or such other securities, in cash or otherwise. The foregoing sentence shall not apply to (a) transactions relating to shares of Common Stock or other securities acquired in open market transactions after the completion of the Public Offering, provided that no filing under Section 16(a) of the Exchange Act shall be required or shall be voluntarily made in connection with subsequent sales of Common Stock or other securities acquired in such open market transactions, (b) transfers of shares of Common Stock or any security convertible into Common Stock as a bona fide gift, or (c) distributions of shares of Common Stock or any security convertible into Common Stock to limited partners or stockholders of the undersigned; provided that in the case of any transfer or distribution pursuant to clause (b) or (c), (i) each donee or distributee shall sign and deliver a lock-up letter substantially in the form of this letter and (ii) no filing under Section 16(a) of the Exchange Act, reporting a reduction in beneficial ownership of shares of Common Stock, shall be required or shall be voluntarily made during the Restricted Period, or (d) the establishment of a trading plan pursuant to Rule 10b5-1 under the Exchange Act for the transfer of shares of Common Stock, provided that (i) such plan does not provide for the transfer of Common Stock during the Restricted Period and (ii) to the extent a public announcement or filing under the Exchange Act, if any, is required of or voluntarily made by or on behalf of the undersigned or the Company regarding the establishment of such plan, such announcement or filing shall include a statement to the effect that no transfer of Common Stock may be made under such plan during the Restricted Period. In addition, the undersigned agrees that, without the prior written consent of Morgan Stanley on behalf of the Underwriters, it will not, during the Restricted Period, make any demand for or exercise any right with respect to, the registration of any shares of Common Stock or any security convertible into or exercisable or exchangeable for Common Stock. The undersigned also agrees and consents to the entry of stop transfer instructions with the Company’s transfer agent and registrar against the transfer of the undersigned’s shares of Common Stock except in compliance with the foregoing restrictions.

The undersigned understands that the Company and the Underwriters are relying upon this agreement in proceeding toward consummation of the Public Offering. The undersigned further understands that this agreement is irrevocable and shall be binding upon the undersigned’s heirs, legal representatives, successors and assigns.

[Signature Page Follows]

Whether or not the Public Offering actually occurs depends on a number of factors, including market conditions. Any Public Offering will only be made pursuant to an Underwriting Agreement, the terms of which are subject to negotiation between the Company and the Underwriters.