Last Updated on May 8, 2020
Reports indicate that a merger between a technology giant in SBTech and the sports betting and fantasy sports brand of DraftKings is set to finalize in early 2020. DraftKings CEO Jason Robins explains on CNBC below.
There are many moving parts to this deal, as Robins explained.
This is where the company Diamond Eagle Acquisition Corporation (DEAC) comes in, which is already public and listed as a NASDAQ company.
DEAC is a company which specifically handles special acquisitions, backed by Jeff Sagansky and Harry Sloan. This company will rename its name to “DraftKings“, given the merger of the two companies (SBTech and DraftKings).
To make this happen, DraftKings is receiving over $300M in investment, which brings the market cap to over $3.3B and plenty of cash on hand to enter states with new regulation and legislation, as eluded to by Robins.
Who is SBTech?
SBTech is a technology company, which has been focused on providing white labels to all types of betting operators.
It’s website’s metadata on Google says “SBTech supplies world-leading online bookmakers and white label operators with best-in-class sports betting and iGaming platform solutions.”
Given the combination of this technology company with DraftKings, it creates a unique ability to be free. Many operators rely on partnerships with tech companies, and now it is assumed DraftKings is now a part of the white labeling company, which will certainly rid the need for a third party and provide more revenue for the company.
Having in-house technology is massive for a sportsbook (and online casino), and that is exactly what is achieved in this merger. DraftKings currently uses Kambi for its bookmaking technology, but that will not continue.
How Can I Buy DraftKings Stock?
Currently, this company has not been formed. It is on track to close in 2020, but the Diamond Eagle Acquisition Corporation is currently trading on NASDAQ (DEACU) at over $11.50 a share (as of Monday afternoon), which is up around 10%.
Once the new company is “formed”, the name will change to DraftKings and there will certainly be a new symbol on the NASDAQ.
This stock will certainly be a popular one for those following sports betting in the United States, as it has a brand and tech company and is already “public” in the general sense of the word.
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