DraftKings, Diamond Eagle Acquisition Corp.
and SBTech Enter Business Combination Agreement
Institutional Investors Commit to Invest
$304 million at Closing
DraftKings CEO and Co-Founder Jason Robins
to lead combined company
Investor Call Scheduled for Monday, December
23 at 11AM ET
DraftKings Inc. (“DraftKings”), a digital sports entertainment
and gaming company known for its industry-leading daily fantasy
sports and mobile sports betting platforms, has entered into a
definitive business combination agreement with Diamond Eagle
Acquisition Corp. (Nasdaq: DEAC) (“Diamond Eagle”), a publicly
traded special purpose acquisition company, and SBTech, an
international turnkey provider of cutting-edge sports betting and
gaming technologies.
The combined company will become the only vertically-integrated
pure-play sports betting and online gaming company based in the
United States. The transaction is expected to close in the first
half of 2020. In connection with the closing of the transaction,
Diamond Eagle intends to change its name to DraftKings Inc.,
reincorporate in Nevada and remain Nasdaq-listed under a new ticker
symbol.
“The combination of DraftKings’ leading and trusted brand, deep
focus on customer experience and data science expertise and
SBTech’s highly innovative and proven technology platform creates a
vertically-integrated powerhouse,” said Jason Robins co-founder and
CEO of DraftKings. “I look forward to building significantly upon
our goals of continuing our state-by-state rollout and creating the
most entertaining and engaging customer experiences for sports fans
globally.”
The new DraftKings will continue to be led by co-founder and CEO
Jason Robins and will retain DraftKings’ highly experienced
management team, including co-founders Paul Liberman and Matt
Kalish. The SBTech management team who bring a wealth of
international markets, trading and risk management experience will
also be integrated into the organization.
Institutional investors (including funds managed by Capital
Research and Management Company, Wellington Management Company and
Franklin Templeton) have committed to a private investment of $304
million in Class A common stock of the combined company that will
close concurrently with the business combination and, subject to
any redemptions by DEAC stockholders, there is $400 million
currently held in Diamond Eagle’s trust account. It is anticipated
that the combined company will have an equity market capitalization
at closing of approximately $3.3 billion and have over $500 million
of unrestricted cash on the balance sheet.
“We are pleased to bring DraftKings and SBTech together as one
public company,” said Harry E. Sloan, Founding Investor of Diamond
Eagle. “DraftKings is already a premier online fantasy sports and
betting platform. With the full integration of SBTech’s technology
and innovative product expertise coupled with the right
capitalization, DraftKings will be in a great position to continue
its ambitious expansion plans in the United States. I have known
Jason Robins for four years, and consider him a true entrepreneur.
I believe our investors share my utmost respect for his vision and
leadership.”
DraftKings Brand Highlights
- Since becoming the first mobile operator to launch in New
Jersey in August 2018, DraftKings has consistently maintained
greater than 30% online market share, and for the nine months ended
September 30, 2019, the company recorded 8.5x year-over-year
revenue growth in the state. DraftKings currently offers mobile and
online sports betting in Indiana, New Jersey, Pennsylvania and West
Virginia, and retail locations in Iowa, Mississippi, New Jersey and
New York.
- DraftKings’ daily fantasy sports product is available in 43
states and 8 international markets including Australia, Canada and
the U.K., has approximately 60% market share and leverages its
customer acquisition and cross-selling model for its sportsbook and
iGaming offerings.
- DraftKings established a “one-platform” model by launching
features like single sign-on, an integrated wallet and universal
user profile, that allows a user to move seamlessly between a DFS
contest, a sports wager and a hand of blackjack, enabling the
company to quickly bring to market new offerings without
reinventing the wheel of an entirely new back-end
infrastructure.
SBTech Highlights
- SBTech is a premier global full-service B2B turnkey technology
provider with omni-channel sports betting solutions, trading
services, and marketing and bonus tools powering some of the
world’s most popular sports betting and online gaming brands.
- 50+ partners in 20+ regulated markets and jurisdictions
including Czech Republic, Denmark, Ireland, Italy, Mexico,
Portugal, Spain, Sweden, and U.K. and Arkansas, Indiana,
Mississippi, New Jersey, Oregon and Pennsylvania in United
States.
- Awarded exclusive contract offering mobile and retail sports
betting for the Oregon state lottery with their Oregon Lottery
Scoreboard brand.
“The combination of DraftKings and SBTech brings together two
tech-native companies with the customer at their cores,” said Gavin
Isaacs, SBTech’s Chairman. “SBTech will maintain its core business
and continue its B2B focus. We are excited about the opportunity to
join a company with a similar innovation DNA and create a unique
and differentiated player in global sports betting and online
gaming.”
Key Transaction Terms
The respective boards of directors or managers, as applicable,
of DraftKings, SBTech and Diamond Eagle have unanimously approved
the proposed business combination. Completion of the proposed
business combination is expected in the first half of 2020. The
transaction will be effected pursuant to the terms and conditions
of the Business Combination Agreement entered into by DraftKings,
SBTech, and Diamond Eagle, and the other parties thereto, which
contains customary closing conditions, including the registration
statement being declared effective by the Securities and Exchange
Commission (“SEC”), approval by the shareholders or members, as
applicable, of DraftKings and SBTech (each of which has been
obtained) and the stockholders of Diamond Eagle, and certain
regulatory approvals.
Goldman Sachs is acting as exclusive financial advisor to
Diamond Eagle. Raine Group is acting as exclusive financial advisor
to DraftKings. Sullivan & Cromwell LLP is acting as legal
advisor to DraftKings. Winston & Strawn LLP is acting as legal
advisor to Diamond Eagle. Stifel is acting as financial advisor and
Herzog, Fox & Neeman and Skadden, Arps, Slate, Meagher &
Flom LLP are acting as legal advisors to SBTech. Goldman Sachs and
Credit Suisse are acting as private placement agents to Diamond
Eagle.
Conference Call and Webcast Information
Investors may listen to a pre-recorded call regarding the
proposed business combination at 11:00 am EST on December 23, 2019.
The live call may be accessed by dialing (877) 451-6152 for
domestic callers or (201) 389-0879 for international callers. Once
connected with the operator, please provide the conference ID of
“13697668.”
A replay of the call will also be available from 2:00 pm EST on
December 23, 2019 to 11:59 pm EST on December 30th 2019. To access
the replay, the domestic toll-free access number is (844) 512-2921
and participants should provide the conference ID of
“13697668.”
Please visit Diamond Eagle’s website
http://eagleinvestmentpartners.com/ to access the webcast.
On the call, the presenters will be reviewing an investor
presentation, which will be available on Diamond Eagle’s website
and filed with the SEC as an exhibit to a Current Report on Form
8-K prior to the call, and available on the SEC website at
www.sec.gov.
Additional Information about the Business Combination and
Where to Find It
In connection with the proposed business combination, DEAC NV
Merger Corp., a subsidiary of Diamond Eagle and the going-forward
public company to be renamed DraftKings Inc. at closing (“New
DraftKings”), intends to file a registration statement on Form S-4
(the “Registration Statement”) with the SEC, which will include a
proxy statement/prospectus, and certain other related documents, to
be used at the meeting of stockholders to approve the proposed
business combination. INVESTORS AND SECURITY HOLDERS OF DIAMOND
EAGLE ARE URGED TO READ THE PROXY STATEMENT/PROSPECTUS, ANY
AMENDMENTS THERETO AND OTHER RELEVANT DOCUMENTS THAT WILL BE FILED
WITH THE SEC CAREFULLY AND IN THEIR ENTIRETY WHEN THEY BECOME
AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT
DRAFTKINGS, SBTECH, DIAMOND EAGLE AND THE BUSINESS COMBINATION. The
definitive proxy statement will be mailed to shareholders of
Diamond Eagle as of a record date to be established for voting on
the proposed business combination. Investors and security holders
will also be able to obtain copies of the Registration Statement
and other documents containing important information about each of
the companies once such documents are filed with the SEC, without
charge, at the SEC's web site at www.sec.gov,or by directing a
request to: Diamond Eagle Acquisition Corp., 2121 Avenue of the
Stars, Suite 2300, Los Angeles, California, Attention: Eli Baker,
President, Chief Financial Officer and Secretary, (310)
209-7280.
Participants in the Solicitation
Diamond Eagle and its directors and executive officers may be
deemed participants in the solicitation of proxies from Diamond
Eagle's shareholders with respect to the business combination. A
list of the names of those directors and executive officers and a
description of their interests in Diamond Eagle is contained in the
final prospectus for Diamond Eagle's initial public offering, which
was filed with the SEC on May 14, 2019, and is available free of
charge at the SEC's web site at www.sec.gov, or by directing a
request to Diamond Eagle Acquisition Corp., 2121 Avenue of the
Stars, Suite 2300, Los Angeles, California, Attention: Eli Baker,
President, Chief Financial Officer and Secretary, (310) 209-7280.
Additional information regarding the interests of such participants
will be set forth in the Registration Statement for the proposed
business combination when available.
Each of DraftKings and SBTech and its directors and executive
officers may also be deemed to be participants in the solicitation
of proxies from the shareholders of Diamond Eagle in connection
with the proposed business combination. A list of the names of such
directors and executive officers and information regarding their
interests in the business combination will be contained in the
Registration Statement for the business combination when
available.
About DraftKings
DraftKings is a U.S.-based digital sports entertainment and
gaming company created to fuel the competitive spirits of sports
fans with offerings that range across daily fantasy sports, sports
betting and regulated gaming. Founded in 2011 by Jason Robins, Matt
Kalish and Paul Liberman, DraftKings’ daily fantasy sports product
is available in 8 countries internationally with 15 distinct sport
categories. Launched in 2018, DraftKings Sportsbook offers mobile
and retail betting for major national and global sports, and
currently operates pursuant to state regulations in Indiana, Iowa,
Mississippi, New Jersey, New York, Pennsylvania and West Virginia.
DraftKings is the Official Daily Fantasy Partner of the NFL and PGA
Tour as well as an Authorized Gaming Operator of the MLB and NBA.
Headquartered in Boston, DraftKings holds offices across the
country including Las Vegas, New Jersey, New York, and San
Francisco.
About SBTech
SBTech is a global leader in omni-channel sports betting and
gaming, with more than 1,200 employees in 10 offices worldwide.
Since 2007, the group has developed the industry’s most powerful
online sports betting and casino platform, serving licensees in
more than 15 regulated territories. SBTech’s clients include many
of the world’s premier betting and gaming operators, state
lotteries, land-based casinos, horse racing companies, and iGaming
start-ups. The group supplies highly flexible betting and gaming
solutions to clients looking for exceptional configurability and
the quickest route to market, complemented by proven business
intelligence and reporting capabilities. The SBTech offering
includes its seamless sportsbook, Chameleon360 igaming platform,
managed services, on-property sportsbook and omni-channel solutions
that provide players with constant access to sports and casino
products across all online, mobile and retail channels. Supported
by unrivalled expertise in trading and risk management, acquisition
and CRM, and the highest standards of regulatory compliance,
SBTech’s partners consistently achieve rapid growth, enhanced brand
loyalty and record revenues.
About Diamond Eagle Acquisition Corp.
Founded by media executive Jeff Sagansky and founding investor
Harry Sloan, Diamond Eagle Acquisition Corp. was formed for the
purpose of effecting a merger, capital stock exchange, asset
acquisition, stock purchase, reorganization or similar business
combination with one or more businesses.
Forward-Looking Statements
Certain statements made in this release are "forward looking
statements" within the meaning of the "safe harbor" provisions of
the United States Private Securities Litigation Reform Act of 1995.
When used in this press release, the words "estimates,"
"projected," "expects," "anticipates," "forecasts," "plans,"
"intends," "believes," "seeks," "may," "will," "should," "future,"
"propose" and variations of these words or similar expressions (or
the negative versions of such words or expressions) are intended to
identify forward-looking statements. These forward-looking
statements are not guarantees of future performance, conditions or
results, and involve a number of known and unknown risks,
uncertainties, assumptions and other important factors, many of
which are outside Diamond Eagle's, DraftKings’ or SBTech’s control,
that could cause actual results or outcomes to differ materially
from those discussed in the forward-looking statements. Important
factors, among others, that may affect actual results or outcomes
include the inability to complete the business combination
(including due to the failure to receive required shareholder
approvals, failure to receive approvals or other determinations
from certain gaming regulatory authorities, or the failure of other
closing conditions); the inability to recognize the anticipated
benefits of the proposed business combination; the inability to
obtain or maintain the listing of the New DraftKings’ shares on
Nasdaq following the business combination; costs related to the
business combination; the risk that the business combination
disrupts current plans and operations as a result of the
announcement and consummation of the business combination; New
DraftKings’ ability to manage growth; New DraftKings’ ability to
execute its business plan and meet its projections; potential
litigation involving Diamond Eagle, DraftKings, SBTech, or after
the closing, New DraftKings; changes in applicable laws or
regulations, particularly with respect to gaming, and general
economic and market conditions impacting demand for DraftKings or
SBTech products and services, and in particular economic and market
conditions in the media/entertainment/gaming/software industry in
the markets in which DraftKings and SBTech operate; and other risks
and uncertainties indicated from time to time in the proxy
statement/prospectus relating to the business combination,
including those under “Risk Factors” therein, and in Diamond
Eagle’s other filings with the SEC. None of Diamond Eagle,
DraftKings or SBTech undertakes any obligation to update or revise
any forward-looking statements, whether as a result of new
information, future events or otherwise, except as required by
law.
No Offer or Solicitation
This press release does not constitute a solicitation of a
proxy, consent or authorization with respect to any securities or
in respect of the proposed transaction. This press release also
does not constitute an offer to sell or the solicitation of an
offer to buy any securities, nor will there be any sale of
securities in any states or jurisdictions in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such jurisdiction.
No offering of securities will be made except by means of a
prospectus meeting the requirements of section 10 of the Securities
Act of 1933, as amended, or an exemption therefrom.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20191223005130/en/
MEDIA: Media@draftkings.com
Jeff Pryor/Priority PR for Diamond Eagle (818) 661-6368
INVESTORS:
Investors@draftkings.com Eli Baker for Diamond Eagle (424) 284-3519
elibaker@geacq.com
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