DraftKings announced on Monday that it will take over Golden Nugget Online Gaming in an all-stock transaction deal worth an estimated $1.56 billion.
As part of the deal, the sports betting and fantasy football giant will undergo a holding company reorganization, forming a new holding company under the name New DraftKings, which will be treated as the public firm for DraftKings and Golden Nugget going forward. As part of the merger, DraftKings will also enter a commercial agreement with Fertitta Entertainment, Inc, the parent company of the Houston Rockets, Golden Nugget, LLC and Landry’s LLC.
The agreement is anticipated to generate synergies of $300M at maturity and will boost revenue from additional cross-promotion opportunities, such as the ability to purchase discounted rewards and book reservations using the DraftKings VIP rewards program.
Speaking about the acquisition, DraftKings CEO and Chairman of the Board Jason Robins commented: “Our acquisition of Golden Nugget Online Gaming, a brand synonymous with iGaming and entertainment, will enhance our ability to instantly reach a broader consumer base, including Golden Nugget’s loyal ‘iGaming-first’ customers.”
“This deal creates meaningful synergies such as increased combined company revenues driven by additional cross-sell opportunities, loyalty integrations and tech-driven product expansion as well as technology optimisation and greater marketing efficiencies. We look forward to Tilman being an active member of our Board and one of our largest shareholders.”
Tilman Fertitta, Chairman and CEO of GNOG, said: “This transaction will add great value to the shareholders as two market leaders merge into a leading global player in digital sports, entertainment and online gaming”.
“Leveraging Fertitta Entertainment’s broad entertainment offerings and extensive customer database, coupled with DraftKings’ mammoth network makes this an unbeatable partnership. Together, we can offer value to our combined customer base that is unparalleled.”
“We believe DraftKings is one of the leading players in this burgeoning space and couldn’t be more excited to lock arms with Jason and the DraftKings family across our entire portfolio of assets, including the Houston Rockets, the Golden Nugget Casinos and Landry’s vast portfolio of restaurants. This is a strong commercial agreement for both companies.”
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