The gaming world is witnessing one of the biggest mergers in industry history. Flutter Entertainment, previously known as Paddy Power Betfair, has announced the $6 billion usd purchase of The Stars Group (TSG) to create a global gambling mega-giant.
Flutter recently announced the all-share deal with the Canadian-based company that owns the world’s biggest poker site, PokerStars, in anticipation of the expected sports betting boom in the United States.
The merger will produce the largest company of its kind, with anticipated revenues of nearly $5 billion USD.
Flutter Entertainment
Flutter was created by the 2015 merger of Paddy Power and Betfair, two successful bookmakers in the UK. Since then they’ve been eating up smaller companies, building their empire.
They acquired Fan Duel, one of the largest grossing sports betting sites in New Jersey, to create the Fan Duel Group last year. This was followed by the acquision of 51% controlling share of Adjarabet, an online sports betting company based in the country of Georgia.
Prior to the Stars merger, Flutter Entertainment was made up of 7 heavy hitting betting brands.
- Betfair
- Paddy Power
- Sportsbet.com.au
- TVG Network
- Timeform
- FanDuel
- Adjarabet
The Stars Group
The Stars Group, formerly known as Amaya, has been doing some expanding of its own as of late. They signed a multi-billion-dollar deal with UK’s Sky Betting and Gaming in 2018 and another with Fox Sports in the US earlier this year.
TSG brand roster is pretty impressive on its own:
- PokerStars
- PokerStars Championship
- Full Tilt Poker
- PokerStars Festival
- Sky Betting & Gaming
- BetStars
- PokerStars Casino
- PokerStars MEGASTACK
Stock Market Impact
As the two companies join forces, the stock market is taking notice. The new mega-corporation will have a premium listing on the London Stock Exchange from their combined headquarters in Dublin, Ireland.
Following the merger, Flutter shareholders will own approximately 54.64% while TSG shareholders 45.36% of the new group.
Flutter’s shares jumped 14% yesterday, while TSG climbed 35%.
Merger Monopoly?
Of course, all this has to be approved before it is a done deal.
Regulus Partners, an international gambling consultancy firm, has estimate that the merger would result in a combined market share of 38% in the UK alone. This will probably draw attention from the Competition and Markets Authority.
However, it’s possible the company won’t stop with TSG says Russ Mould, AJ Bell Investment Director.
“The latest deal in the bookmaking and gambling business may also prompt speculation as to which firms will be next to acquire – and which firms will be their targets.”
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