Sports-betting giant DraftKings has acquired even greater market share – and Tilman Fertitta has potentially exited the online-gaming market – with the closure today of DraftKings’ purchase of Golden Nugget Online.
DraftKings indicated it would continue to employ the Golden Nugget brand name “to broaden its reach into new customer segments and enhance the combined company’s igaming product offerings through DraftKings’ vertically integrated tech stack and Golden Nugget Online Gaming’s unique capabilities,” such as live-dealer games, which Fertitta was first to offer in New Jersey.
DraftKings was careful to note that the deal does not include or pertain to any of Golden Nugget’s brick-and-mortar properties, owned by Fertitta Entertainment.
“Acquiring Golden Nugget Online Gaming gives us synergies across our business,” said DraftKings CEO Jason Robins. “We anticipate that this acquisition will provide meaningful revenue uplift by utilizing our data-driven marketing capabilities and a dual brand iGaming strategy, gross-margin-improvement opportunities, and cost savings across external marketing.”
For his part, Fertitta hinted at an ongoing role with DraftKings. “This will be an alliance unlike any other in the digital sports, entertainment, and online-gaming industry. Now that the acquisition is completed, I look forward to what the future will bring for our combined company and am confident this relationship will be a huge success.”
At least some Golden Nugget personnel will be retained, specifically former president Thomas Winter, who becomes general manager of igaming for North America. “Expected synergies,” presumably including the elimination of redundant functions and positions, are anticipated to save $300 million.
DraftKings also expects to grow revenue from a wider game library and more live-dealer offerings. Golden Nugget Online content will be placed atop DraftKings’ existing platform, “which is expected to deliver cost savings by reducing Golden Nugget Online Gaming’s third-party platform costs, operating expenses, and vendor costs,” according to a company press release.
Despite its Golden Nugget takeover, DraftKings is still unable to offer igaming or sports betting in its home state of Massachusetts. Both houses of the commonwealth’s legislature have passed sports betting bills, but they differ significantly on taxation and whether wagers can be taken on collegiate games. One key lawmaker initially said the latter was a “dealbreaker,” but recently softened his position, potentially clearing the way for sports betting to reach Gov. Charlie Baker’s desk, where it will be signed, before the current session ends.
