DraftKings Drops $22 Billion Pursuits of Ladbrokes Owner Entain
DraftKings Drops $22 Billion Pursuits of Ladbrokes Owner Entain
DraftKings is no longer pursuing its attempt to purchase gambling group and industry powerhouse Entain. DraftKings had proposed to acquire Entain for an estimated $22 billion cash and stock takeover but it appears that the Entain board has rejected the offer. As a result, DraftKings is no longer going to pursue this takeover.
Entain operates numerous European-based sports betting and iGaming brands including Coral, Bwin, and Ladbrokes, and is one of the biggest and most well-known international gambling operators in the world. Had this acquisition process been completed successfully, DraftKings would have emerged as one of the biggest operators in the globe as Entain operates its own back-end technology, which is quite a rare feat for global casino operators.
In September this year, DraftKings offered to acquire Entain at $3.86 for every share, an offer that was to be paid through a mixture of cash and stock. Earlier on, Entain had received a cash and stock offer but the board rejected this offer as well. This deal was made even more complicated owing to MGM Resorts. MGM Resorts and Entain both have equal shares of BetMGM, which is one of DraftKing’s biggest rivals to date.
Now that the deal has been rejected, DraftKings will have to wait for at least 6 months before making another offer for Entain. According to the laws governing mergers and acquisitions in Britain, DraftKings will not be allowed to make another bid unless the brand gets another competing offer before the 6 months are up.
Will DraftKings continue pursuing growth in international markets?
As last year was coming to a close, DraftKings inked a partnership with Peermont Hotels and Resorts, which is currently based in South Africa as part of its global expansion plans. DraftKings will offer Peermont the necessary software and technology to offer its online casino and Daily Fantasy product. Peermont, on the other hand, will offer DraftKings the visibility it needs to grow and attract customers in the South African gambling market.
DraftKings will likely keep pursuing expansion in other international markets as it is already available in at least 8 countries including Austria, Australia, as well as Ireland. As part of its expansion plans, DraftKings is expected to keep making partnerships and collaborations with more established brands and organizations thus cementing its dominance in the gambling industry.
Mergers and acquisitions are part of the US sports betting market
Ever since the Supreme Court legalized sports betting in 2018, the online and sports betting industry has grown from strength to strength. When the pandemic shuttered brick-and-mortar casinos, gamblers started looking for online activities to occupy their free time, which explains how online gambling and sports betting have become so popular among punters and sports lovers.
It is during the pandemic period that shares of DraftKings took off after the brand went public through the SPAC merger, which resulted in one of the highest valuations that DraftKings has ever received since it was founded. At the time of the SPAC merger, there were no live sports for individuals to wager on, which goes to show DraftKing’s position in the US gambling market.
In the future, the US market expects to see even more British firms making a play for the gambling market in the US. State laws in the country require operators to partner up with local casinos before they can be awarded licenses to operate. DraftKings’ bid for Entain was preceded by Caesars Entertainment’s takeover of William Hill, in a £2.9bn takeover. After purchasing William Hill, Caesars opted to maintain its US-based operation but it sold off William Hill’s UK-based business to 888 for an estimated £2.2bn.
DraftKings making a play at the crypto market
DraftKings has been interested in adding cryptocurrency payments for its online sports betting customers for years now and it appears that the brand finally has the opportunity. Recently, DraftKings partnered up with Polygon, an Ethereum based platform. Polygon has partnered up with Draftkings Marketplace, which is growing in popularity among digital trading cards and NFT lovers.
This partnership with Polygon has provided Draftkings Marketplace with a customer-friendly Blockchain solution that has expanded the brand’s capabilities. Even though DraftKings Marketplace is still relatively young, this partnership with Polygon will go a long way in ensuring the nascent brand’s growth in the iGaming market. Since its debut in August this year, DraftKings Marketplace has hosted numerous NFT collections that have sold out including NFTs of well-known athletes the likes of Naomi Osaka, Tom Brady, Simone Biles, Wayne Gretzky, and Derek Jeter.
With Polygon’s powerful technology, DraftKings Marketplace will be able to expand the variety of products it offers punters while establishing its position in the marketplace. This new partnership will also allow the brand to offer punters a better user experience with an even bigger array of exclusive content and NFTs. DraftKings Marketplace is one of the only established marketplaces and the only operator that is currently offering sports fans and collectors a straightforward way to purchase and resell original digital cards and collectibles.
Since the market was legalized, several major mergers and acquisitions have been made. Some of the biggest ones include Flutter’s takeover of FanDuel, Penn National’s acquisition of Barstool, as well as DraftKings’ acquisition of SBTech. Deals of this nature will only grow in popularity as the sports betting phenomenon continues to grow in North America. Moving forward, the gambling industry should expect to experience even more mergers and acquisitions of this nature.
As DraftKings continues to pursue growth all over the country and internationally, the brand has grown into a giant in the gambling space. So much so that the brand has been awarded several high-level awards including sportsbook and casino operator for successive years. Now that the brand has expanded into cryptocurrency and Blockchain services, the company will continue to expand into new regions and grow its user base which will allow the brand to maintain its impressive financial performance while also ensuring growth into new regions and markets.
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