DraftKings Acquires Golden Nugget
This week, DraftKings Inc closed the acquisition of Golden Nugget Online Gaming, Inc for a whopping $1.56 billion. The move which become public on May 5, 2022, brought to an end the prolonged negotiations between the two companies. To put this into context, DraftKings’ bid to acquire Golden Nugget was approved in August 2021. It has therefore taken months to finalize.
Now, they can both concentrate on how they are going to capitalize on their market position. As per the terms of the acquisition, DraftKings will be able to use Golden Nugget Online Gaming’s strong brand to expand its reach into new consumer categories and boost the combined company’s iGaming product offerings. For that, it will be leveraging Golden Nugget’s vertically-integrated tech stack and unique features. This includes the Live Dealer offering.
The Golden Nugget casinos were not part of this acquisition and will remain to be the property of Fertitta Entertainment. However, the parties did hint that there are some rebranding possibilities ahead. The plan is that some retail sportsbooks at Fertitta Entertainment’s Golden Nugget resorts will be rebranded as DraftKings sportsbooks.
“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 and SG&A. I am proud to welcome the Golden Nugget Online Gaming team to the DraftKings family.”Jason Robins, Chairman and CEO of DraftKings
In terms of organizational changes, DraftKings will incorporate Golden Nugget Online Gaming staff throughout the company. That will apply to Thomas Winter as well. He will be shifting from his prior job as President of Golden Nugget Online Gaming to General Manager of North America iGaming.
DraftKings’ Ambitious Plans
DraftKings has not been shy about its ambitious expansion plans in the United States. The acquisition of Golden Nugget presents a unique opportunity for the company to further affirm its position as a market leader in the United States.
It boasts of being a global sports betting and gambling technology firm with offices in 17 countries. The company provides iGaming through its DraftKings brand in five US states, as well as Golden Nugget Online Gaming in three. Its Sportsbook is available in 18 states and accepts mobile and/or retail wagers. As if that is not enough it offers daily fantasy sports in 15 different sports and six different countries.
That is a neat portfolio that will come in handy when gauging the company’s impressive growth trajectory. More acquisitions and market debuts are likely on the way.