The acquisition will, among other things, allow DraftKings to leverage Golden Nugget’s established brand to broaden its reach into new customer segments and enhance the combined company’s iGaming product offerings through DraftKings’ vertically-integrated tech stack and Golden Nugget Online Gaming’s unique capabilities – including Live Dealer.
DraftKings will pay 0.365 newly issued shares for each common share of Golden Nugget Online Gaming. At the time of the deal, DraftKings shares traded at US$51.59, though they have since declined to US$14.99 upon market close yesterday. Thus the deal, which was set to be worth US$1.56bn at the time of announcement, would now be worth around US$450m.
DraftKings expects US$300m worth of annual synergies from the deal at maturity, while it also anticipates revenue to grow through cross-selling opportunities.
The deal does not include brick and mortar Golden Nugget casinos, which will continue to be owned by Fertitta Entertainment.
“Acquiring Golden Nugget Online Gaming gives us synergies across our business,” said Jason Robins, Chairman and CEO of DraftKings. “We anticipate that this acquisition will provide meaningful revenue uplift by utilizing our data-driven marketing capabilities and a dual brand iGaming strategy, gross margin improvement opportunities, and cost savings across external marketing and SG&A. I am proud to welcome the Golden Nugget Online Gaming team to the DraftKings family.”
“This will be an alliance unlike any other in the digital sports, entertainment and online gaming industry,” said Tilman Fertitta, Chairman and CEO of Golden Nugget Online Gaming. “Now that the acquisition is completed, I look forward to what the future will bring for our combined company and am confident this relationship will be a huge success.”
DraftKings will integrate Golden Nugget Online Gaming employees across its business, including Thomas Winter, who will transition to General Manager of North America iGaming, from his previous role as President of Golden Nugget Online Gaming.
Source: GMB
