Sports Betting Giant DraftKings Planing Merger, To Go Public

BOSTON (AP) - Sports wagering giant DraftKings prepares to merge with two other firms and go public, the Boston-based company revealed Monday.


DraftKings stated it will complete its merger with betting tech company SBTech and acquisition company Diamond Eagle Acquisition sometime in the first half of 2020.


DraftKings stated the combined company will be valued at $3.3 billion, and it will have $500 million on hand once the offer is complete.


The brand-new business will retain the DraftKings name and business co-founder and CEO Jason Robins will continue to lead it, along with a management team that includes co-founders Paul Liberman and Matt Kalish.


DraftKings said it will likewise reincorporate in Nevada but stay physically headquartered in Boston, where it's one of the city's biggest tech business, with approximately 600 workers in its just recently opened headquarters in the Back Bay area.


The 3 companies are combining through a special purpose acquisition, a method of taking a business public that differs from the more familiar initial public offering, or IPO, process, DraftKings said.


The brand-new company will efficiently assume Diamond Eagle's publicly-traded status, though under a brand-new stock ticker symbol.


It will likewise receive a $400 million infusion from the Los Angeles-based business, which was founded previously this year by Jeff Sagansky, a previous president of CBS Entertainment, and Harry Sloan, a previous chairman and CEO of MGM, in order to buy media and digital entertainment ventures.


SBTech's management group, meanwhile, will be incorporated into the brand-new business, however the information of that won't be revealed till next year, according to DraftKings.


The business has offices on the Isle of Man, in London and in other places in Europe, and supplies sports and programs to betting operations worldwide. It was founded in 2007.


DraftKings was founded in Boston in 2012 as a purveyor of day-to-day fantasy sports contests, which are are online video games that challenge gamers to construct lineups of real athletes in order to vie for cash and other prizes based on how those professional athletes carry out in video games.


The business has because expanded into online and retail sports books operations in the handful of states that have actually legislated sports wagering, including Indiana, New Jersey, Pennsylvania, West Virginia, Iowa, Mississippi, New Jersey and New York City.


DraftKings had previously attempted to merge with its primary competitor, FanDuel.


But the 2 companies scrapped the plans in 2017 after the Federal Trade Commission and the lawyers general of California and the District of Columbia took legal action against to obstruct it over antitrust concerns.


New York-based FanDuel finished a merger with Dublin-based gaming giant Paddy Power Betfair last year rather.


This story has actually been upgraded to remedy that the companies are planning a special function acquisition, not a preliminary public offering.