Rovell: DraftKings to Raise Around $1 Billion Through Stock Offering, Robert Kraft Cashes Out
Denise Truscello/Getty Images for DraftKings.
In the world of sports betting, companies can’t seem to have enough money for the future.
DraftKings filed documents with the Securities and Exchange Commission on Monday, announcing the intention to raise money by selling 16 million additional shares that, when priced, will add an additional $800 million to $1 billion to the company’s coffer.
In addition, certain shareholders have agreed to sell some of their shares, including New England Patriots owner Robert Kraft. Kraft and his sons, Jonathan and Daniel, have a DraftKings portfolio worth $172 million based on the current stock price. Kraft is selling approximately 10 percent of his shares.
DraftKings’ stock closed at an all-time high $63.78 on Friday.
In the filing, DraftKings said its yet-to-be-finalized financials from July, August and September will result in revenue of between $131 and $133 million. However, its marketing expenses for those three months combined will be north of $200 million.
The company also notes a negative impact on its business due to COVID-19 and a larger win percentage for its customers on NFL betting.
The company did say, however, that more than one million bettors made bets with DraftKings in those three months, representing a growth of 64% as compared to those same months in 2019. The handle from those three months has grown 460% compared to the same period in 2019.