DraftKings completes acquisition of Tilman Fertitta’s Golden Nugget Online Gaming

DraftKings, the fantasy sports and sports betting company, said Thursday that it has closed on its deal to acquire Golden Nugget Online Gaming, the internet gambling company controlled by Houston billionaire Tilman Fertitta. The all-stock deal was valued at about $1.6 billion when it was announced in August. The acquisition was part of a broader consolidation in the sports betting industry. The merger with DraftKings, a leader in the market, gives Golden Nugget Online Gaming a broader reach than it had achieved on its own. When the deal was announced, Fertitta, Golden Nugget’s chairman and CEO, controlled all of online gaming business’ Class B shares, amounting to nearly 90 percent of the company’s voting power. He owned around 7 million, 46 percent, of its Class A stock and agreed to hold his shares for a minimum of one year after closing. He was given a seat on DraftKings’ board.

“This will be an alliance unlike any other in the digital sports, entertainment and online gaming industry, “Fertitta said in a statement. “I look forward to what the future will bring for our combined company and am confident this relationship will be a huge success.” DraftKings said it expects to achieve about $300 million in savings from the deal. The deal does not include brick and mortar Golden Nugget Casinos, which remain properties of Fertitta’s company Fertitta Entertainment. The merger, however, will allow expect to rebrand certain current and future sports betting operation at into DraftKings sportsbooks. When the deal was announced, DraftKings said it reached an agreement with Fertitta to become the exclusive fantasy sports and online gaming partner of the Houston Rockets, which Fertitta also owns, and aims to open a sportsbook at the Toyota Center pending legalization in Texas. As part of the agreement, DraftKings members will earn points they can use at Fertitta’s restaurants and casinos, a perk that would drive customers into his brick-and-mortar businesses. “Acquiring Golden Nugget Online Gaming gives us synergies across our business,” said Jason Robins, CEO of DraftKings. DraftKings, headquartered in Boston, more than doubled its revenues to nearly $1.3 billion in 2021 from about $615 million in 2020, according to SEC filings. Its net loss widened to about $1.5 billion from $1.2 billion in 2020.