The gambling industry is, at times, hit by mega-mergers that get the entire sector talking. The latest of these to occur is the takeover of The Stars Group by Flutter Entertainment. The latter may not be very well known by its operator name, but the platforms that it runs – including Betfair, FanDuel and Paddy Power – are all popular with online gamblers.
The merger is to take place via an all share combination, and immediately following the completion of this, Flutter Entertainment shareholders would be in possession of around 54.64% while The Stars Group shareholders would own approximately 45.36% of the combined group.
The Stars Group, which is best-known for having one of the world’s greatest poker networks in PokerStars, and Flutter’s unison will supposedly have various parts comprising its Board. This will be made up of 14 people from both brands, with the Chair of the Combined Group being taken by Gary McGann, who currently operates as the chair of Flutter. The current Executive Chairman of The Stars Group, Divyesh Gadhia is expected to assume the role of Deputy Chair for the Combined Group.
The approval of shareholders from both companies is expected to be sought out in the second quarter of 2020. After this, the completion of the merger is expected to take place at the end of the second quarter or beginning of the third, 2020.
Words from the People in Power
It didn’t take long for various key players in the mega-merger to speak out on such, starting with the aforementioned Mr McGann of Flutter. He said that it’s an “exciting and transformational combination”, which will unite two of the world’s strongest businesses in order to make a global leader in the sports betting and gaming industries. He spoke of the new management team under Peter Jackson (current CEO of Flutter and set to move into the position of CEO of the Combined Group) as being one that will have the necessary experience to ensure that the integration of the two businesses goes without major disruption.
The current CEO of The Stars Group, Rafi Ashkenazi – who is expected to assume the role of COO of the Combined Group – said that the combination of the two companies will allow everyone involved to “enhance and accelerate” any existing strategies in place. He said that The Stars Group has gone through a transformation recently, moving from a single product operator of poker and into being a “diverse global leader” that provides bettors with multiple products.
Finally, it was the aforementioned Mr Jackson of Flutter who spoke of the combination representing “a great opportunity to deliver a steep change in our presence in international markets”, before commenting on placing themselves in a prime position to be table to take advantage of the sports betting scene in the US.
If The Stars Group and Flutter had gone through this merger in 2018, a pro forma figure on annual revenue for that year estimates a sum of £3.8 billion. That would have made it the world’s largest online gambling operator.