Last week, Irish bookmaker and online gaming company Paddy Power Betfair agreed to acquire one of the two leading daily fantasy sports sites, FanDuel, in what appears to be Paddy Power’s effort to strengthen its footprint in the soon-to-be expanded United States sports betting market.

Paddy Power likely isn’t all that interested in getting into the daily fantasy sports space. We’re guessing that it is attracted to FanDuel because of FanDuel’s presence in the U.S. and in particular the company’s database of players. There is going to be a tremendous overlap between DFS players and people interested in betting on sports, so Paddy Power Betfair can get those deposit bonus offers out to millions of players at soon as the green light turns on.

Paddy Power does have U.S. business already, as it operates the TVG horseracing betting network and an online gambling site in New Jersey. One would think that it will be able to get a sports betting license fairly easily.

“We are excited to add FanDuel to the Group’s portfolio of leading sports brands,” said Peter Jackson, Paddy Power Betfair’s Chief Executive Officer, in a press release. “This combination creates the industry’s largest online business in the US, with a large sports-focused customer base and an extensive nationwide footprint. The Group has leading sports betting operating capabilities globally and strong operations on the ground in the US. Together with our substantial financial firepower, we believe we are now exceptionally well placed to target the prospective US sport betting opportunity.”

“FanDuel and Betfair US share an enthusiasm for innovation and, as a result of today’s announcement, are prepared to lead the charge into the US sports betting market,” said Matt King, CEO of FanDuel. “The combination of our brands and team, along with a shared culture and vision for the future, will allow us to create the leading gaming destination for sports fans everywhere.”

The Deal by the Numbers

Nowhere in FanDuel’s press release is an information about the financial figures involved in the deal. For that, we need to turn to Paddy Power Betfair’s announcement. While both companies say this is a “combination” or a “merger,” it is clearly an acquisition.

According to Paddy Power’s press release, in addition to combining its U.S. business with FanDuel’s, Paddy Power will contribute $158 million cash. This cash will be used to pay FanDuel’s $76 million of debt as well as generally “fund working capital of the combined business.”

The deal is expected to close in the third quarter of this year. At that point, Paddy Power Betfair will own 61 percent of the new company. That percentage will grow over time: 80 percent after three years and then 100 percent after five years. So yes, Paddy Power Betfair is acquiring FanDuel. FanDuel will become a subsidiary of Paddy Power Betfair; Paddy Power will be able to appoint a CEO and most of the Board.

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