FanDuel and DraftKings have decided to scrap their merger rather than fight the U.S. government, which had sought to block the combination of the countrys two top daily fantasy sports sites on grounds that it threatened competition and consumers.
In a statement, FanDuel CEO Nigel Eccles said the companies believed even until the end that the merger would have aided both companies growth. But he stressed that it was in the best interest of our shareholders, customers, employees, and partners to terminate the merger agreement and move forward as an independent company.
DraftKings, meanwhile, confirmed its decision to drop the deal, while touting its future prospects. We have a growing customer base of nearly 8 million, our revenue is growing over 30 percent year-over-year, and we are only just beginning to take our product overseas to the billions of international sports fans we have yet to even reach, said its chief executive, Jason Robbins, in a statement.
Initially, FanDuel and DraftKings believed that their tie-up, first announced in November, could help them weather their shared, mounting financial woes, while tackling a perilous regulatory environment that at times resulted in stiff fines.
But the Federal Trade Commission the agency reviewing the transaction determined that the two companies combined would have served more than 90 percent of the market for daily fantasy sports bets. Those games allow players to draft weekly rosters of athletes and wager on their performance.
