Paddy Power owner's shares jump on US prospects — but Murdoch is waiting in the wings
Flutter, which owns Paddy Power, saw its shares close 7% ahead today despite saying no decision had yet been made on a US stock listing, but confirming it was considering listing 'a small shareholding' in FanDuel, among other options.
Shares in Paddy Power owner Flutter Entertainment surged after the global betting giant confirmed it is considering a partial stock exchange listing of its main business in the US.
The company's shares closed almost 7% ahead, having climbed by almost as much as 10% at one point.
Responding to US media speculation, Flutter said “no decision has been made”, but that a listing in the US of “a small shareholding” in its FanDuel business there is being considered, along with other options, to boost capital.
Flutter cemented its leading position in the rapidly-opening US market last year by completing its takeover of North American gaming group Stars and buying up more of fantasy sports betting business FanDuel.
The Paddy Power owner now owns 95% of FanDuel, which makes up the vast bulk of Flutter's US operations.
Analysts expect Flutter to list part of FanDuel in the US within the next couple of months and for Flutter to retain significant ownership control after the partial IPO.
However, an ownership issue with Rupert Murdoch’s Fox Corporation will need resolving.
Fox is one of Flutter’s main shareholders, with a 2.6% stake. Fox also has rights to purchase an 18.5% stake in FanDuel from this summer. That agreement is linked to Fox having an existing naming licence deal for Stars Group’s Fox Bet business in the US.
Flutter has said it intends to offer to Fox the option to purchase the FanDuel stake at fair market value in July.
FanDuel’s main rival in the US fantasy sports betting market is DraftKings, which is already listed and has a market value of over $29bn. FanDuel is considerably larger, however, with revenues of around $900m compared to DraftKings’ $643m.
Flutter said, earlier this month, that the US online betting market could be worth as much as $20bn (€17bn) by 2025, double what it had previously estimated.
