When someone thinks of daily fantasy sports, DraftKings is undoubtedly the first thing to come to mind. Founded by a trio of digital marketing workers in 2012, DraftKings operates as a daily fantasy sports and betting operator.
DraftKings started small with a one-on-one direct baseball competition. But after three years, its value skyrocketed to $1.5 billion, according to Fortune. According to AssetDash, by July 2021, it reached a market capitalization of around $20.64 billion.
Even after gaining massive profit, the company is devoted to expanding its influence. Through various merger agreements with companies, DraftKings is increasingly being regarded as a major leader for all fantasy sports sites.
You can find out more in our DraftKings review.
DraftKings SPAC Merger
In 2020, DraftKings completed a reverse merger deal with SPAC (special purpose acquisition company) Diamond Eagle Acquisition Corporation for $3.3 billion.
When it was finalized, DraftKings entered the stock market as a public company on April 24, 2020. From the starting price of $19.35, DraftKings’ stock grew by 269 percent to $52.10 as of August 2021.
DraftKings’ vision for expansion continued until one particular deal brought it to a climax.
DraftKings and FanDuel Merger Called Off
Does DraftKings own FanDuel?
Although DraftKings and FanDuel fiercely competed in the fantasy sports market, they were painstakingly close to merging. In November 2016, both reached a verbal agreement for a merger that would have created a 90 percent control of the DFS sites market.
But in the spring of 2017, the merger was blocked by the Federal Trade Commission on antitrust grounds.
“For years, the vigorous competition between DraftKings and FanDuel has spurred innovation and favorable pricing. If this DraftKings merger had been allowed to go through, those benefits would likely have been lost,” said Markus Meier, acting director for the FTC’s Bureau of Competition.
Although the FanDuel merger fell through, DraftKings was not dismayed in its pursuit for expansion. And so, the organization started diversifying its ventures. Throughout 2021 alone, it acquired three notable companies:
- Vegas Stats & Information Network (VSiN),
- Blue Ribbon
- Golden Nugget Online Gaming.
Here’s an overview of the DraftKings acquisition of those companies.
In March, DraftKings acquired VSiN, a multi-platform broadcaster focused on sports betting-oriented programming. Under this partnership, DraftKings can create 24/7 content for sports bettors throughout the country, a major step up from when DK operated in 14 states beforehand.
One month later in April, DraftKings bought BlueRibbon, an Isreali global jackpot and gamification company that provided real-time tools for fully customizable jackpot promotions.
Coupled with BlueRibbon’s technology that enhances consumer experience, DraftKings can, as said by DK co-founder and President of Global Technology and Product Paul Liberman, “create dynamic incentives for our users as they engage with our products.”
In early August, DraftKings acquired Golden Nugget Online Gaming in an agreement for approximately $1.56 billion. Besides transmitting GNOG’s five million customers to DraftKings, the agreement also led to the commercial partnership with Fertitta Entertainment, LLC, whose CEO Tillman Fertitta owned the Houston Rockets.
Specifically with Fertitta Entertainment, DraftKings entered a commercial agreement that includes marketing integration and sponsorship assets for both parties.