Online sports betting operator Draftkings and SBTech have announced a merger deal. The two companies will be one entity once the deal is finalized which is set to take place next year.
Following the deal, Draftkings will go public as it will merge with SBTech, Diamond Eagle Acquisition Corp., a publicly-traded acquisition company.
While the deal is expected to close in the first half of 2020, it is said that the new entity would also be headquartered in Boston and that Jason Robins, chief executive officer of DraftKings, will be leading the new entity.
“The combination of DraftKings’ leading and trusted brand, deep focus on customer experience and data science expertise and SBTech’s highly innovative and proven technology platform creates a vertically-integrated powerhouse,” Robins said in the statement.
The merger will see the creation of a $3.3 billion new sports gambling giant.
“We are pleased to bring DraftKings and SBTech together as one public company,” said Harry E. Sloan, Founding Investor of Diamond Eagle.
“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, DraftKings will be in a great position to continue its ambitious expansion plans in the United States. I have known Jason Robins for four years, and consider him a true entrepreneur. I believe our investors share my utmost respect for his vision and leadership.”
DraftKing became the first mobile gambling operator to launch in New Jersey in 2018 after the US Supreme Court lifted the ban on sports gambling. The operator commands over 30 percent of the market share.
The company claims that its daily fantasy sports product is available in 43 states and 8 international markets including Australia, Canada and the U.K., have approximately 60% market share and leverages its customer acquisition and cross-selling model for its sportsbook and iGaming offerings.