Flutter Entertainment will pay $1.76bn for the stake. It’s buying it from Boyd Gaming Group, but has extended a long-term partnership with the group until 2038.
It also means that the value of FanDuel has jumped by $11bn since 2020.
Following an arbitration ruling in 2022, Fox Corporation secured a 10-year right to exercise an option to buy a near 19pc stake in FanDuel. The price it will have to pay if it decides to do so is based on a ruling that determined the valuation of FanDuel to be $20bn in 2020.
The deal for Boyd Gaming’s stake implies that Flutter investors are roughly pencilling in a $20bn valuation on the remainder of the business, including Paddy Power and Betfair, based on Flutter’s now $51bn market capitalisation in New York.
FanDuel has seized a lead in the United States in many states that have now legalised sports betting.
FanDuel has a 43pc market share in spots betting and 27pc in iGaming in its US markets. Flutter generated revenue of $14bn last year, with $5.7bn of that generated by FanDuel.
Flutter chief executive Peter Jackson described the group’s acquisition of FanDuel in 2018 as “one of the most transformational events” in the company’s history.
“I am really pleased to drive future value for our shareholders by increasing our ownership of FanDuel to 100pc,” he said.
The deal is expected to close in the third quarter of the year and will be funded by additional debt.
“This transaction delivers more attractive market access terms in states where FanDuel’s market access is provided by Boyd4 and is expected to contribute annual operating cost savings of approximately $65m,” noted Flutter.
“The savings are expected to be generated from July 1, 2025, and further underpin Flutter’s confidence in the long-term profitability profile of its US business, demonstrating the ability to help mitigate both recent and future tax increases,” it added.
FanDuel’s march across the United States and into Canada – it expects expand its Canadian footprint into Alberta next year – has also drawn it into an increasing number of legal battles.
This week, the latest salvo was fired in California, which does not have legalised sports betting. A class action lawsuit launched there against FanDuel and Flutter claims they have been operating mobile gambling applications and websites within California, “representing to customers and the public that its daily fantasy sports contests, often branded as ‘FanDuel Fantasy’, are legal forms of gambling in California. They are not.”
The complaint notes that advertising intelligence group MediaRadar estimates FanDuel spends about $500m a year on marketing and advertising, often using celebrities.
FanDuel is also the subject of a number of other legal actions in other states. Earlier this year, the mayor of Baltimore accused FanDuel of causing “significant harm” to “vulnerable residents” with its betting practices.
after the mayor of the city of Baltimore, Brandon Scott, accused FanDuel of causing “significant harm” to “vulnerable residents” with its betting practices.
FanDuel said it is confident it operates in accordance with all laws, including those in Maryland.
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