DraftKings could be seeking merger in order to go public
The private company is reportedly talking to Diamond Eagle about a deal
Right now, DraftKings seems to be running hot in the market. This Boston-based company is now finding itself in front of a very lucrative opportunity for sports betting contracts in New Hampshire, among others, and it wants to capitalize on its massive footprint and strengths. In order to do that, it might go public by merging with a publicly-traded company, Diamond Eagle Acquisition Corp.
Financial news site Bloomberg reported that Diamond Eagle is the company that is interested in making the merger happen, probably to allow DraftKings to go public on its own. Diamond Eagle was formed back in March and it has been publicly traded on the NASDAQ stock exchange and according to the company’s prospectus, “effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization, or other similar business combination” are what their goals are. The company may have been created for the sole purpose of the DraftKings deal.
This is not the first time DraftKings has been on the verge of completing an acquisition. Three years ago, government officials filed a suit and stopped the company from being acquired by their competition, FanDuel.
Diamond Eagle has a lot of gaming talent. Its founder, Jeff Sagansky, is also the former president of CBS Entertainment. Eli Baker, its CFO and legal affairs expert formerly with Lionsgate/Artisan Entertainment and Harry Sloan, who occupied positions of chairman and CEO of Metro-Goldwyn-Mayer ten years ago, are also involved at the top level, giving the company a trio of top-notch experience to guide any merger forward.
DraftKings began providing its fantasy sports experience over seven years ago, and last year opened the first retail and online sportsbook in New Jersey. They have been going through rapid growth and expansion of the online sports betting app this year alone. Along with New Jersey, DraftKings added West Virginia and Indiana to its online portfolio. This pending deal they have with New Hampshire Lottery Commission promises to be the most lucrative they have had until now.
The Pennsylvania Gaming Control Board gave the go-ahead to DraftKings for a sports betting license last Wednesday. Now New Hampshire, in addition, could bring the nearest option so far for all those Boston fans that want to try their luck and be on any of the four major professional leagues, since the state has teams in all four of them.