Gambling giant Flutter Entertainment closed a 44.2 billion deal to improve its stake in US live casino sports betting and daily fantasy sports firm FanDuel. Its stake was moved to 95%.
In 2018, Flutter joined its operation in the United States with FanDuel. In early December, the gambling powerhouse made it known that it would use an alternative ahead of the July 2023 date that was agreed on previously to buy a 37.2% stake in FanDuel.
This deal was a blend of stock and cash. Flutter was able to £1.1 billion from different investors. Included in these investors is Rupert Murdoch as part of the funding for the project.
Before being bought by Flutter Entertainment, this stake belonged to Fastball Holdings consortium of investors. The US casino operator Boyd Gaming retained the remaining 5% stake.
Flutter has made plans to make payment for the FanDuel stake by issuing close to 11.7 million new ordinary shares and through close to $2.03 billion in cash.
In a meeting that took place on the 29th of December, 99.9% of shareholders at Flutter supported this transaction.
Statement from the CEO
According to Peter Jackson, the firm’s CEO, Due to this deal, Flutter will be more exposed to the United States market in a period when there is an increase in the number of states accepting online gaming and sports betting. He did not stop at that. He also made it known that the firm bought the stake at a discount to its estimate of the business’ value.
Fox Tabled an Alternative to Get a Stake in Flutter
As already mentioned, media powerhouse Fox Corporation took part in the raising of capital for FanDuel's stake. According to Flutter, Fox was given the alternative to buy a part of the Irish gambling firm in July 2021, and it was going to discuss with them to find out if they are still interested or not.
Before Flutter lifted its stake in FanDuel, Fox had a 2.6% stake in Flutter. FOX Sports business will have the freedom of buying 18.5% of Flutter in July 2021.
What the CEO of Fox had to Say
According to Lachlan Murdoch, Fox Corporation Executive Chairman and CEO, Fox shows its commitment to Flutter over the long term by simply keeping its ownership stake in the gambling firm. Mr. Murdoch did not stop at that. He proceeded to make it known that they have engaged their audience with sports betting content, and they are happy they can help them access products from Flutter’s collection of US-facing brands.
It is noteworthy that The Stars Group and FOX Sports that are a part of Flutter, declared a sports and media betting partnership in 2019 that let to FOX Bet wagering operation being launched in 2019.