Early Wednesday morning, two gaming companies announced a major merger that creates the new largest gaming company in the world.
The two companies involved are The Stars Group (TSG) and Flutter Gaming. The Stars Group is the parent company of PokerStars and Fox Bet, among other brands. Flutter Gaming is better known as Paddy Power Betfair. The company also owns the FanDuel brand.
New gaming company valued at $11.3 billion
Per the announcement, the merger will create the world’s biggest gaming company, valued at approximately $11.3 billion. Paddy Power Betfair will own about 55% of the new company. TSG shareholders will own roughly 45% of the venture.
Flutter CEO Peter Jackson spoke about how the deal will affect both companies’ US operations:
“The combination represents a great opportunity to deliver a step-change in our presence in international markets and ensure we are ideally positioned to take advantage of the exciting opportunity in the US through a media relationship with FOX Sports as well as our development of US sports betting through Flutter’s FanDuel and TSG’s FOX Bet brands. We are committed to these two high-quality brands to drive the growth of the Combined Group in the US.”
Gary McCann, who currently chairs Flutter, will take over the chairman role at the new company. Jackson will take on the role of CEO of the combined group. TSG CEO Rafi Ashkenazi will shift over as the new company’s COO. The company will also create a 14-member board to oversee operations.
Ashkenazi was also enthusiastic about the new venture:
“This exciting combination will allow us to enhance and accelerate our existing strategy. In recent years, we have transformed TSG from a single-product operator in poker to a diverse global leader with multiple product offerings across poker, gaming, and sports betting. The combination with Flutter will further enhance our company’s core strengths and position us strongly for the future in this rapidly evolving industry.”
What does this mean for Pennsylvania?
Both Flutter and TSG are operational in Pennsylvania. Flutter’s FanDuel Sportsbook is the state’s biggest sports betting site, while TSG launched the Fox Bet online sportsbook less than a month ago.
Per the release, there will definitely be a consolidation of resources behind the scenes. The most notable change is moving the sportsbooks to a single platform. There is no indication which platform that will be, but given FanDuel’s rave reviews, it seems more likely that Fox Bet will shift its look and feel. Of course, it is also possible that both operations utilize an all-new platform. Everything is still up in the air on this front.
Gamblers can expect both brands to remain in US markets and both expand into new markets as well. Rather than pare down to a single brand, the merger seems more about offering the two brands access to the highest number of states possible.
Flutter’s deal with Boyd Gaming, which is how the company’s partnership with Valley Forge came to be, puts Flutter in potentially 24 states. The Stars Group could gain access to many of those states as well. That is if the sports betting and online gambling legislation allow for multiple skins on a single license.
In the near-term, the deal could mean that Pennsylvania’s top two brands are from the same provider. Though it is unclear just how much Fox Bet has permeated the Keystone State market. Once August numbers come out, it will be more apparent just how big a powerhouse this new company will be in Pennsylvania.