Flutter Entertainment and Nasdaq- and Toronto-listed Stars Group said today they were merging in a deal that will create one of the world’s largest gambling businesses.
Shareholders in Flutter, formerly known as Paddy Power Betfair, will own approximately 54.6 per cent of the new company with Stars shareholders owning approximately 45.3 per cent of the combined group.
The combined revenue of the two businesses in 2018 was £3.8bn and their combined market capitalisation is £11bn, enough to make it one of the world’s largest online betting and gaming operators globally.
The new business will be based in Dublin, with a premium listing on the London Stock Exchange and a secondary listing on Euronext Dublin.
Flutter shares jumped nearly 14 per cent this morning to 8,700p.
News of the deal also boosted other gambling stocks, with William Hill up 3.65 per cent, 888 Holdings up 1.8 per cent and GVC Holdings up nearly one per cent.
The two businesses said the merger would help the combined group crack the US market which is liberalising its gambling rules.
The pair said the deal would create value for shareholders with pre-tax cost-synergies of £140m per annum along with lower finance costs.
Flutter chief executive Peter Jackson will be chief executive of the combined group with Flutter chair Gary McGann taking the role of chair.
Flutter has entered into third-party deals in the US with Fox Sports, Fastball Holdings and Boyd Interactive Gaming conditional on the merger going ahead.