The fantasy sports website DraftKings
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Daily fantasy sports company and bookmaker DraftKings is merging with a special purpose acquisition company, allowing it to become public while forgoing the typical IPO process.
DraftKings is combining with SBTech, a betting and gaming company, and Diamond Eagle Acquisition Corp., a SPAC with a market cap of roughly $500 million. The companies announced the deal on Monday.
The deal is expected to close in the first half of 2020, according to the announcement. As part of the deal, Diamond Eagle will change its name to DraftKings and change its ticker symbol. The company will trade on the Nasdaq.
DraftKings and fellow fantasy gaming site FanDuel gained popularity earlier in the decade for their daily fantasy sports products, battling state regulators that argued they were gambling sites. The two companies explored a merger of their own but dropped the idea in 2017 following pushback from the Federal Trade Commission.
Since a 2018 ruling by the Supreme Court that struck down a federal ban on sports gambling, DraftKings has become a gambling bookmaker. The company currently offers online and mobile betting in four states, with retail locations in several others.
The deal also includes a $304 million equity investment from several institutional investors that will close at the same time the merger is completed, according to the announcement.