Draftkings is in on the verge of acquiring giant SBTech, online gaming provider, sources have claimed. The move comes in the wake of Draftkings looking on ways of how to expand its sportsbook operations and it would see the company get its own in-house betting software.
Draftkings has been on the rise since the US Supreme Court gave an okay to sports betting in May 2018. The daily fantasy sports company has taken the US market with its strongest punch and this move has been seen as one to expand their market push even further.
Details about the sale price and the dates are still scanty as it is a deal that seems to be in the early stages yet. When reached about the potential purchase, Draftkings did not confirm it nor did they deny it and the company would state that it reaches out to other companies on various business issues and they would not discuss what they talk in the discussions. ‘…it is our general policy not to discuss the specifics of any of those discussions.’ Said the company.
SBTech partners with the State of Oregon
SBTech has boasted over 50 partnerships worldwide and has made inroads in the US after the Supreme Court ruling. This has seen the provider form partnerships with Golden Nugget Casinos, Pala Interactive and Churchill Downs sportsbooks.
June has seen SBTech partner with the State of Oregon to run its sports betting operations which is hoped to be ready by September when the next NFL season starts. This would be a benefactor to Draftkings as it looks on to improve its ever-growing US market share and potentially taking over the Oregon monopoly.
For Oregon lottery, it estimates sports betting revenue that amounts to $141.2 Million on the first three years. Interesting times lay ahead as it is not clear if Draftkings will retain SBTech as business partners or if they will be interested in the technology. Still on the offing is B2C, other SBTech operations, which might also be on purchase. SBTech has had its price tag estimated at figures between $300 Million – $500 Million by Las Vegas Report
Kambi the expected loser
If the deal is to be agreed, Kambi looks to be the biggest loser. Kambi has been the sports betting provider for Drafkings since June 2018. The operator shares went down on the Stockholm Stock Exchange by 20% in early trading according to an LSR publication.
If Kambi is to lose Draftkings, who have been the sports betting head in New Jersey, then, the provider will seem to be the loser on this deal. Draftkings has seen its market overtaking that of Nevada making it a force that every provider would want to work with.
There has been a change of guard from both parties with SBTech hiring Meissa Riahei as the first president of US operations and Draftkings have seen a new CFO installed. The former Bain Capital Private Equity operating partner, Jason Park. The move could be pointers to the anticipated Draftkings and SBTech purchase deal.