DraftKings enter into a definitive business combination agreement with Diamond Eagle Acquisition Corp. and SBTech. After DraftKings become public company, it will be the only vertically-integrated pure-play online gambling company in the US.
DraftKings become public company
On December 23, DraftKings made an announcement that it will become a listed company via an acquisition by Diamond Eagles Acquisition Corporation to acquire it along with SBTech.
DraftKings is already a premier online fantasy sports and betting platform. With the full integration of SBTech’s technology and innovative product expertise coupled with the right capitalization, it will be in a great position to continue its ambitious expansion plans in the United States.
Jason Robins, Co-Founder & CEO of DraftKings, said: “The combination of DraftKings’ leading and trusted brand, deep focus on customer experience and data science expertise. SBTech’s highly innovative and proven technology platform creates a vertically-integrated powerhouse.”
According to the announcement, the deal includes investment from top institutional investors including funds managed by Capital Research and Management, Wellington Management and Franklin Templeton.
Notably, experts foresee that the business combination will have an equity market capitalization at the closing of approximately $3.3 billion; with over $500 million of unrestricted cash on the balance sheet.
Harry E. Sloan, Founding Investor of Diamond Eagle, said: “I have known Jason Robins for four years, and consider him a true entrepreneur. In fact, I believe our investors share my utmost respect for his vision and leadership.”
Key Transaction Terms – DraftKings become public company
- DraftKings no longer relies on a third-party for critical functions. The company’s platform is currently provided by Kambi.
- The board of directors/managers of DraftKings, SBTech and Diamond Eagle have unanimously approved the business combination proposal.
- In fact, we can expect the completion of the business combination proposal in the first half of 2020.
- Diamond Eagle intends to change its name to DraftKings Inc. reincorporate in Nevada. Indeed, with a new ticker symbol, it remains under Nasdaq stock exchange listings.
- Co-founder and CEO of DraftKings, Jason Robins will continue to lead New DraftKings. Likewise, Paul Liberman (chief operating officer) and Matt Kalish (chief revenue officer) will remain with the business.
- Currently, $400 million is held in Diamond Eagle’s trust account.
- In addition, the deal includes a $304m equity investment from several institutional investors.
More about DraftKings
DraftKings was founded in 2011 as a competitor to FanDuel, an early daily fantasy sports mover. Since the Supreme Court’s decision of allowing sports betting beyond Nevada, DraftKings is working on a sports betting platform with Kambi.
With headquarters in Boston, DraftKings holds offices across the country including Las Vegas, New Jersey, New York, and San Francisco. DraftKings currently offers mobile and online sports betting in Indiana, New Jersey, Pennsylvania, and West Virginia. In addition, it offers sports betting at retail locations in Iowa, Mississippi, New Jersey and New York.
DraftKings has a single sign-in option for a complete gambling experience. The DraftKings online website has an integrated wallet and universal user profile. Hence, it allows a user to move seamlessly between a sports wager, DFS contest, and a hand of casino games.
DraftKings DFS product is available in 8 countries internationally with 15 distinct sports categories. Certainly, it is the official partner of the NFL and PGA Tour. Furthermore, it is an Authorized Gaming Operator of the MLB and NBA. DraftKings’ online sports betting website is well-known for providing high odds for sports and leagues like Soccer, Tennis, NHL, NFL, NBA, MLB, and many more.
Who is SBTech?
SBTech is a global premier B2B technology provider with omnichannel sports betting solutions. It powers some of the world’s most popular sports betting and online gaming brands. SBTech has over 50 partners in more than 20 legal markets all over the world.
SBTech continues to entrust Continent 8 Technologies as its global datacentre and connectivity provider. Continent 8’s US multi-state includes Mississippi, Nevada, New Jersey, Pennsylvania, and West Virginia, along with New York and Ohio. The SBTech management team brings a wealth of international markets, trading and risk management experience.
SBTech has established key US partnerships with market-leading operators such as Churchill Downs, Golden Nugget, Resorts Casino Hotel, Pala, and Oaklawn Resort. Furthermore, SBTech is also the sports betting supplier for the Oregon State Lottery. Now, SBTech also looks forward to being integrated into the new combined organization.