DraftKings Inc., in a move viewed as a significant investment in the booming iGaming industry, has agreed to purchase Golden Nugget Online Gaming via an all-stock acquisition that is valued at approximately $1.56 billion, the companyMonday morning.
DraftKings expects use the combined resources to boost sales and market share, yielding $300 million in savings from overlapping costs and creating new cross-selling opportunities, the companies said Monday in a statement. The deal, which has been approved by both companies’ boards, is expected to close in the first quarter of 2022.
Fertitta said he expects more consolidation in the online betting industry and that he picked DraftKings to merge with because he expects it to be a long-term winner.
“DraftKings is definitely best in class,” he said in an interview Monday on Bloomberg TV. “They’re a tech company. We’re a bricks and sticks company.”
Shares of Golden Nugget jumped as much as 52% to $18.71 in New York. DraftKings rose almost 2% before retreating.
DraftKings will enter into a commercial agreement with Fertitta Entertainment Inc., the parent company of the Golden Nugget casinos and Landry’s restaurants, that will allow the online betting giant to market its products to Fertitta’s patrons in its physical locations and through its customer loyalty program.