DraftKings Agrees to Acquire Golden Nugget Online Gaming for $1.56 Billion in Stock
Scott Eisen/Getty Images for DraftKings.
DraftKings has agreed to buy Golden Nugget Online Gaming in an all-stock acquisition for $1.56 billion, the company announced Monday morning. The deal is expected to close in the first quarter of 2022.
As sportsbooks add better iGaming to their platforms, including casino games, acquisitions like this are expected. Golden Nugget, for example, has a database of more than five million people, including gamblers in New Jersey and Michigan and customers in its Landry’s Select Club loyalty program.
The biggest innovation in iGaming over the past few years has been live dealers. Golden Nugget has been in the game since 2016 and is undergoing a major overhaul to its operations.
Retail sportsbooks at current Golden Nuggets casinos will be rebranded as DraftKings.
DraftKings Sportsbook is currently live in 12 states representing 25% of the population. But it has only four states — New Jersey, West Virginia, Pennsylvania and Michigan — representing 10% of the population in iGaming. DraftKings does not currently break out what percentage of the business is Sportsbook compared to iGaming.
DraftKings CEO Jason Robins said on the call that Golden Nugget has a more mature iGaming customer and a base that skews more female than DraftKings’ current demographic, meaning there’s not much overlap in the acquisition.
DraftKings stock was up fractionally (0.31%) when the market opened on Monday.
Houston Rockets owner Tilman Feritta, who took his properties public, including Golden Nugget, in a deal that values its assets of $8.6 billion, will join the DraftKings board.
“They are the Coca Cola of this industry,” Fertitta said on a conference call on Monday morning. “There is going to be a lot of consolidation in this space in the next few years and we want to be a part of the winner.”
Robins said that should Texas legalize sports gambling, the deal provides that DraftKings would be the official sportsbook of the Houston Rockets and would be in line to have a branded sportsbook in the Toyota Center.
Golden Nugget can now also take sports bets on the Rockets. It was wholly owned by Fertitta, so NBA rules prohibited the Nugget from doing so.