Well, it’s not a name that rolls off the tongue, but if a planned merger between Paddy Power Betfair and US Daily Fantasy Sports operator FanDuel goes ahead, it’s a name that we’re all going to have to get used to.
This week the US Supreme Court finally came to a decision on sports betting, overturning the 1992 legislation that made sports betting illegal in most states in the US.
That fired the starting gun in the race to get online sports books established in the US, with most potential operators targeting the start of the 2018/19 NFL season.
Leading the way were the two big Daily Fantasy Sports companies, FanDuel and DraftKings; but, in truth, launching by September 6, when the defending Super Bowl champions Philadelphia Eagles host the Atlanta Falcons in the NFL kick-off game, was always going to be a huge task.
September 6 is less than four months away, so it is absolutely no surprise to see Paddy Power Betfair announce that they are in talks with FanDuel about a potential merger, to create a business “to target the prospective US sports betting market.”
Who is Paddy Power?
The company was formed in 1988 when three Irish bookmakers, Stewart Kenny, David Power, and John Corcoran brought together their 40 shops. The “Power” name was considered the strongest brand and “Paddy” was added, along with the predominant green, to emphasize the “Irishness” of the chain. David Power’s son, who happens to be called Paddy, is a marketing spokesman for the chain.
The company has always pursued an aggressive expansion policy and was listed on the London stock exchange in 2000. It has frequently advertised novelty bets, which haven’t always met with public approval. For example, in November 2008 the company offered 16-to-1 that Barack Obama “would not finish” his term as US President, which was widely seen as betting on Obama’s assassination.
The company entered the US fantasy sports market last year with the acquisition of Draft, a fantasy sports site, for $48m (£35m) and already has a horseracing TV channel and online betting network active in 35 states.
FanDuel’s customer base
The merger would make sense for both companies: FanDuel would immediately gain online betting expertise, while Paddy Power would at a stroke gain access to a significant slice of the 30m Americans who are fantasy sports players. The merger would also presumably see Betfair become more active in US sports, with the increasingly under pressure betting exchange receiving a significant turnover boost.
It may not be the last
Commenting on the possible merger, Neil Wilson, chief analyst at markets.com, said that betting firms were already jockeying for position as the Supreme Court neared a ruling. “DraftKings has already said it will enter the sports betting market,” he said. “Local companies may try and gain market share before UK and European companies make an entrance [into the US market].”
But with William Hill already cheerfully admitting to “investing millions” in readiness for sports betting being legalized in the US, it would be no surprise to see talks about another UK bookmaker/US DFS merger.
Paddy Power Betfair Fan Duel may not roll off the tongue, but William Hill and DraftKings? King of the Hill – or have I heard that somewhere before?