This month saw Flutter Entertainment placing their bid on acquiring the Canadian betting company The Stars Group. Flutter already has Betfair, Paddy Power and Pokerstars to their name. Recently they also bought the New York-based fantasy sports provider, FanDuel. When this deal is approved for the bid valued at $6 billion, it would not only be the third-largest acquisition in gambling history, but it would also make the Dublin based company the most significant online betting provider in the world.
Set against the backdrop of Dublin, roughly 30 years ago, three gambling providers merged, and Paddy Power was founded. Paddy Powers grew to a well-known name and still is very successful in the gambling world of both Ireland and the UK. Paddy Powers operated under the ownership of Flutter Entertainment, which during 2016 bought Betfair for an impressive $10 billion and was then operating both gambling companies from their Dublin based offices. Over time they expanded even more and spread out over the American border when FanDuel was bought. Now they are claiming a more significant stake of the newly founded American market when they finalize the deal with The Stars Group.
The Stars Group
This Canadian supplier owns PokerStars and Sky Betting and Gaming, and when their market share outside of the borders of Australia, the UK and the US are considered, then they are about six times the size of Flutter Entertainment. In addition to that, they have signed a partnership with Fox Sport recently which will be delivering sports betting in the States. In exchange to make this deal a viable option for all involved, the shareholders of TSG has been offered 0.23 of the shares in Flutter for every stock they own in TSG. Indeed a deal which can be lucrative for all, also because when the announcement of the possible acquisition was made, Flutter had an increase of 17% in their shares and TSG had a share price increase in Toronto of 30%.
Since American legislation changed a bit more than a year ago, the US market became an open and lucrative territory for betting providers from all over the globe to claim a piece of this pie. Betting companies from Ireland and the UK are often seen to be at the frontier of this modern-day gold rush because they have years of experience to deliver. Flutter Entertainment has thus far been very successful in spreading its wings in the US market, and this acquisition will only strengthen their position.
Once the deal has been finalized under the guidance of Flutter chief executive, Peter Jackson, the estimated value of the company will be £10 billion, and their annual turnover should be in access of £3.8 million. Not too bad at all for a company that initially started small in the streets of Dublin.