It’s almost officially official. The two beasts of daily fantasy sports have agreed to merge, the transaction is expected to close next year.
The news should not be unexpected, as both companies have spent the last year and a half in the midst of lawsuits and allegations on behalf of illegal gambling practices.
The companies think that the merger will enable them to better serve customers, who pay money to enter a team of actual sports players, winning points based on how those players perform in actual games, with their winners receiving larger cash prizes.
Consumer Affairs reports that the merger will undoubtedly help both enterprises control costs, which rose when they were forced to mount legal defenses in a number of states and later on to lobby various state legislatures for legal exemptions from gambling laws.
The companies from the beginning maintained they were exempt from gambling laws because their games were classified as games of skill, not chance. Many states took issue with that interpretation.
“We have always been passionate about providing the best possible experience for our customers and this merger will help advance our goal of building a transformational global sports entertainment platform,” said DraftKings CEO Jason Robins. “Joining forces will allow us to truly realize the potential of our vision, and as a combined company we will be able to accelerate the pace of innovation and bring a richer experience to our customers than we ever could have done separately.”
Recently, we wrote an article on the probability of this merger occurring. You can read that here.