Popular mobile fantasy league games called DraftKings and FanDuel have been rumored for a long time to merge into one company. And they came out recently to confirm that rumor that they are indeed merging.
Both companies are calling the merge a “strategic merger of equals.” And as usual, there aren’t any official details on how the combined organization will be structured. However, DraftKings CEO Jason Robins will become the CEO of the newly combined company while FanDuel CEO Nigel Eccles will become the chairman of the board.
In an interesting move, both brands will still use their own mobile apps and sites “for the foreseeable future.” Which could help ease some of the confusion between the two companies if they decided to change names because they both don’t want to part with their current branding?
The merger will be expected to be closed sometime in 2017, and as mentioned above, both brands will act separately through the 2017 NFL season. And no financial details have been disclosed, and no details on how investors will be taken into the equation, as well.
In a statement, both the companies acknowledged why the merger has a few benefits “By combining and streamlining resources, FanDuel and DraftKings can work more efficiently and economically with state government officials to develop a standard regulatory framework for the industry. This will not only enhance the long-term growth prospects and improve sustainability for the combined company, but also make it easier for other players to enter and thrive in the market. — DraftKings and FanDuel” Additionally, another reason why the merger is beneficial on both sides is because it means less cost for advertising and less trouble for attaining sponsorships. Because as before, both companies were fighting against each other for the same goal.
To put things in perspective, DraftKings has made $600 million in revenue and FanDuel has raised $416 million. Putting both of those companies revenues together equates to more than $1 billion.