Monday, 24 September, 2018

Paddy Power in discussions to combine USA business with FanDuel

Paddy Power in discussions to combine USA business with FanDuel Paddy Power in discussions to combine USA business with FanDuel
Nellie Chapman | 16 May, 2018, 21:49

The announcement follows the decision of the US Supreme Court which overturned the Professional and Amateur Sports Protection Act of 1992 and lifted the federal ban imposed on sports betting operations by the afore-mentioned piece of legislation.

Paddy Power Betfair plc, together with its subsidiaries, provides online interactive sports betting services in the United Kingdom, Ireland, Australia, the Unites States, and internationally.

The Supreme Court ruling did make sports wagering legal in New Jersey, which already had laws and regulations on the books authorizing the practice. Sports gambling could begin in a matter of weeks in casinos and racetracks in New Jersey, which instigated the legal fight by repealing its gambling ban. Last year, the company bought a daily fantasy company, Draft.com, that has a far smaller footprint than either FanDuel or DraftKings, the two dominant players in the market.

FanDuel, which was blocked from merging with its main competitor DraftKings by the USA competition regulators past year, has been valued at $1bn by some analysts.

Nearly exactly a year ago, Paddy Power Betfair acquired daily fantasy sports platform Draft in a deal worth around US$50mln.

On the other hand, the daily fantasy sports options provider FanDuel would also benefit from a possible merger, as it would be able to consolidate its presence on the local market.

The Dublin-based group also runs the leading horse racing television and betting network in the USA and has an online casino business in New Jersey.

However, while Paddy Power hopes to be the buyer in this case, analysts at the stockbroker Goodbody said European betting firms could find that they are tempting targets for U.S. companies looking to purchase expertise.