DraftKings & FanDuel call off their merger
The proposed merger of daily fantasy sports giants DraftKings and FanDuel is dead.
The companies announced Thursday they were officially abandoning the merger, which would have created a DFS super company. The two companies, which represent the majority of the DFS business, put the kibosh on their plans about a month after the Federal Trade Commission said it would block the highlypublicized merger in court.
“We have determined that it is in the best interest of our shareholders, customers, employees and partners to terminate the merger agreement and move forward as an independent company,” FanDuel CEO Nigel Eccles said in a statement.
The FTC sought to stop the companies from coming together to prevent a virtual monopoly of the industry.
“We believe it is in the best interests of our customers, employees, and investors to terminate our agreement to merge with FanDuel and move forward as a separate company,” DraftKings CEO Jason Robins said in a similar statement. “This will allow us to singularly focus on our mission of providing the most innovative and engaging interactive sports experience imaginable, forever changing the way fans connect with teams and athletes worldwide.”
From a business perspective, the merger made a lot of sense as the companies continue to seek legalization in states around the country. DFS was legalized in New York last year and continues to lobby state and federal lawmakers trying to separate fantasy sports from online gambling. In New York, for example, DFS was determined to be a game of skill rather than a game of chance.
Last year, the companies made their intentions to merge known to the public as a way to cut costs and join forces, rather than compete against each other in a marketplace that continues to evolve.