DraftKings/FanDuel Merger Reportedly Imminent
On Friday, published reports of a major Fantasy industry rumor surfaced, indicating that DraftKings and FanDuel, the two largest companies in the Daily Fantasy Sports space, are set to announce a merger. The news was first reported by FantasyAlarm.com's Howard Bender.
FanDuel and DraftKings have been competing for an ever-growing base of Daily Fantasy Sports (DFS) players, expending hundreds of millions of dollars on advertising in the process. In addition, both companies have also been waging expensive legal battles with several state legislatures, which have sought to regulate DFS and have haggled over whether DFS is gambling or a game of skill.
A representative from FanDuel told RotoExperts that there is no announcement of any sort and there is no story on a potential merger. RotoExperts attempted to reach DraftKings but has not received a response to this point. Speculation about a merger was raised and examined by major media outlets earlier in the year. In June, DraftKings CEO Jason Robins told USA Today that such a merger was “an interesting idea.” The Fantasy Sports Trade Association (FSTA) is not issuing any statements on the matter at this time.
Such a merger would raise instant questions from Fantasy Sports players about how the games would be presented, and even about the future of some sports that the two companies differ on in their offerings.
At one point both companies were reportedly valued at over $1 billion each, but the legal battles with various state attorneys general have negatively affected their overall value. Both companies were able to come to an agreement with New York State, but there remain at least nine other states that have yet to come to an accord on DFS.
FanDuel was founded in 2009 by CEO Nigel Eccles and has grown exponentially in terms of both the games and prize amounts offered. They operate offices in New York City, Edinburgh, Glasgow, Orlando and Los Angeles.
DraftKings was founded in 2012 by Jason Robins, Matthew Kalish, and Paul Liberman, who originally ran the company out of Liberman’s house. They are now based in Boston, MA. In the four years since, DraftKings has partnered with Major League Baseball, the National Hockey League and other investors. They were granted a license to operate in the UK in 2015, and have since launched a mobile app for its users there.
Be sure to check back with RotoExperts for updates on this story as it develops.
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