Daily fantasy and sports betting operator DraftKings announced today it entered into a definitive agreement to acquire Golden Nugget Online Gaming (GNOG) in an all-stock transaction.
Holding an implied equity value of approximately $1.56 billion, the acquisition of the online gaming arm of Tillman Fertitta’s Golden Nugget will enable the Boston-based gambling brand to take advantage of Golden Nugget’s popular brand and iGaming product, and will expand its customer database to combined 5 million users.
Our acquisition of Golden Nugget Online Gaming, a brand synonymous with iGaming and entertainment, will enhance our ability to instantly reach a broader consumer base, including Golden Nugget’s loyal ‘iGaming-first’ customers.”Jason Robins, CEO and Chairman, DraftKings
The acquisition deal involves a reorganization of DraftKings and the formation of a new holding company named New DraftKings, which will be the going-forward company for both DraftKings and GNOG, and will be renamed to DraftKings Inc upon closure of the transaction.
This deal creates meaningful synergies such as increased combined company revenues driven by additional cross-sell opportunities, loyalty integrations and tech-driven product expansion as well as technology optimization and greater marketing efficiencies. We look forward to Tilman being an active member of our Board and one of our largest shareholders.”Jason Robins, CEO and Chairman, DraftKings
Shareholders of GNOG will receive a fixed ratio of 0.365 shares of New DraftKings Class A common stock for each share of GNOG they hold as per the record date. GNOG main stockholder Tilman Fertitta, holding approximately 46% of the shares at GNOG, agreed to hold onto his New DraftKings shares for a minimum of one year from the date of the transaction close.
This transaction will add great value to the shareholders as two market leaders merge into a leading global player in digital sports, entertainment and online gaming.”Tilman Fertitta, Chairman and CEO, GNOG
Boards Signaled the Go-Ahead
A special committee consisting of independent and disinterested directors established by the Board at GNOG unanimously recommended the merger agreement and the transaction, and acting on the committee’s recommendation, the Board of Directors approved the agreement and issued a recommendation to GNOG shareholders to vote in favor of the transaction.
We believe that DraftKings is one of the leading players in this burgeoning space and couldn’t be more excited to lock arms with Jason and the DraftKings family across our entire portfolio of assets, including the Houston Rockets, the Golden Nugget casinos and Landry’s vast portfolio of restaurants.”Tilman Fertitta, Chairman and CEO, GNOG
The all-stock acquisition that was also approved by DraftKings’ Board of Directors is expected to bring synergies of $300 million at maturity, as well as strategic benefits such as enhanced cross-selling, cost savings, enhanced return on advertising spend, reduction of general and administrative costs, reduced market access via Golden Nugget-owned properties, as well as exclusivity across daily fantasy sports, sportsbook and iGaming with the Houston Rockets.