Gambling giant Flutter Entertainment, which own the likes of Paddy Power, Betfair and Sky Betting and Gaming, has agreed a deal to acquire full ownership of the FanDuel business in the US.
The deal is expected to be completed in the third quarter of 2025 and they will pay Boyd Gaming Corporation about $1.76bn to acquire its 5 per cent stake in FanDuel.
Peter Jackson, CEO, commented: “Our acquisition of FanDuel in 2018 is one of the most transformational events in our Group’s history, with its natural competitive advantages combined with access to Flutter Edge capabilities driving impressive growth to become the well-established and clear leader in US online sports betting and iGaming.
“I am really pleased to drive future value for our shareholders by increasing our ownership of FanDuel to 100%. Boyd have been fantastic partners for FanDuel, and we are delighted to be extending our important strategic partnership through to 2038.”
Key strategic objectives
In terms of the deal, Flutter Entertainment outlined their key strategic objectives on the deal through their website, where they detailed that the deal should result in annual savings for Flutter of approximately $65m beginning July 1, 2025 due to the market access granted.
One key objective is: Increased ownership of the market. This transaction secures 100% ownership of FanDuel, the premier asset in the US sports betting and iGaming market.
It reports that FanDuel is the clear number one in the market with a 43% market share in sports betting and 27% in iGaming, driven by key sustainable competitive advantages, including access to the ‘Flutter Edge’.
Their second key objective is Leveraging scale to drive more efficient market access costs, benefiting long-term adjusted EBITDA margin. This transaction delivers more attractive market access terms in states where FanDuel’s market access is provided by Boyd and is expected to contribute annual operating cost savings provided of approximately $65m.
The savings are expected to be generated from July 1, 2025, and further underpin Flutter’s confidence in the long-term profitability profile of its US business, demonstrating the ability to help mitigate both recent and future tax increases.
Other notable metrics
With this deal set to go through, it does confirm which state markets Flutter has access to through Boyd. An original agreement, dating back to 2018, gave FanDuel access to 15 states nationwide in return for a then 4% plus optional 1% stake as well as an undisclosed revenue share.
The new deal shows that the original 15 state market access has now been whittled down to Indiana, Iowa, Kansas, Louisiana and Pennsylvania.
Interestingly, Fox has an option to acquire an 18.6% equity interest in FanDuel on or before December 3, 2030. The price to be paid to exercise the ‘Fox Option’ is the fair market value of FanDuel at December 3, 2020 which was determined to be $20bn plus an annual escalator of 5%. T
As it stands, this currently equates to an exercise price of $4.5bn. A cash payment would be required at the time of exercise and the Fox Option can only be exercised in full.
