(Alliance News) - Flutter Entertainment PLC on Wednesday said it has agreed on the terms of an all-share acquisition of The Stars Group Inc, a Canadian online gambling firm.
Flutter - which was formerly known as Paddy Power Betfair - said the merger will "create a global leader in sports betting and gaming", with the combined company having a diverse portfolio of brands and complementary products with a broad geographic reach.
The FTSE 100-listed bookmaker said the combined firm's annual revenue would have been GBP3.8 billion in 2018, making it the largest online betting and gaming operator globally.
Under the deal, Stars Group shareholders will receive 0.2253 new Flutter shares in exchange for each Stars Group share. Upon completion of the merger, Flutter shareholders would own 55% and Star Group shareholders would own 45% of the combined firm.
Star Group shares closed 0.1% lower in New York on Tuesday at USD9.46 each, while Flutter shares were 13% higher at 8,624.00 pence each in London early on Wednesday morning.
The merged company will be incorporated, headquartered and domiciled in Dublin, Ireland, with a premium listing on the London Stock Exchange and a secondary listing on Euronext Dublin.
"The combination represents a great opportunity to deliver a step change in our presence in international markets and ensure we are ideally positioned to take advantage of the exciting opportunity in the US through a media relationship with FOX Sports as well as our development of US sports betting through Flutter's FanDuel and TSG's FOX Bet brands," said Flutter Chief Executive Peter Jackson.
Stars Group Chief Executive Rafi Ashkenazi added: "This exciting combination will allow us to enhance and accelerate our existing strategy. The combination with Flutter will further enhance our company's core strengths, and position us strongly for the future in this rapidly evolving industry."
Following the completion of the merger, Ashkenazi will assume the role of chief operating officer of the combined firm. Meanwhile, Divyesh Gadhia, currently executive chair of Stars Group, will assume the role of deputy chair of the combined firm.
In addition, Flutter said it appointed Andrew Higginson as independent non-executive director with immediate effect.
Higginson currently serves as chair of grocer Wm Morrison Supermarkets PLC, a position he has held since January 2015. He is also the chair of Evergreen Garden Care Ltd and a non-executive director of Woolworths Holdings Ltd, the South African retailer.
"We are delighted to welcome Andrew as a non-executive director. He brings an extensive wealth of board, commercial, retail and leadership experience to the Board," said Flutter Chair Gary McGann.
By Evelina Grecenko; evelinagrecenko@alliancenews.com
Copyright 2019 Alliance News Limited. All Rights Reserved.
Flutter Entertainment (FLTR)