American DFS and sports betting operator DraftKings has just signed a definitive agreement which will see it acquire Golden Nugget Online Gaming in an all-stock transaction that has an implied equity value amounting to around $1.56 billion.
After the purchase, the operator explained that it will leverage the Golden Nugget brand, igaming product experience and current combined database of over five million customers.
In line with the acquisition, DraftKings also signed a commercial agreement with Fertitta Entertainment, the Houston Rockets, Landry’s and Golden Nugget’s parent company.
This agreement will involve marketing integrations, sponsorship assets with the Houston Rockets, an expanded retail sportsbook presence as well as the chance to obtain market access to favorable terms through select Golden Nugget casinos.
DraftKings will also be the NBA franchise’s exclusive daily fantasy sports, sports betting and igaming partner. It also plans to open a sportsbook at the Toyota Center, subject to state legalization and regulatory approvals.
“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 of the board of DraftKings, said.
“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 market efficiencies.
“We look forward to Tilman being an active member of our board and one of our largest shareholders,” he added.
As part of the deal, DraftKings will also undergo a holding company reorganization and create a new holding company New DraftKings, which will be the going-forward public company for both GNOG and DraftKings. New DraftKings will be renamed DraftKings Inc. at closing.
“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, GNOG chairman and CEO, said.
“Leveraging Fertitta Entertainment’s broad entertainment offerings and extensive customer database, coupled with DraftKings’ mammoth network makes this an unbeatable partnership. Together, we can offer value to our combined customer base that is unparalleled.
“We believe that DraftKings is one of the leading players in this burgeoning space and couldn’t be more exited 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. This is a strong commercial agreement for both companies,” he added.