DraftKings and FanDuel are reportedly in talks to merge with one another.
Unnamed sources claim that DraftKings and FanDuel and in talks to merge with each other. According to these sources, the merger is “imminent.” However, previous rumors have claimed the same with no news coming afterwards.
The sources of the most recent rumors claim that the merger may be announced by DraftKings and FanDuel as soon as this week. They also say that the two have discussed a merged company’s location, executive leadership, websites and other plans.
One problem that the unnamed sources claim is affecting the possible DraftKings and FanDuel merger is financial settlements with the New York attorney general’s office. This includes $6 million for what were claimed to be deceptive and misleading advertisements, reports ESPN.
Another problem facing a potential DraftKings and FanDuel merger are antitrust regulators. The companies are currently the top two in the daily fantasy sports market. A merger would give them a huge advantage over competition and could result in less competition, or a monopoly. This reason alone will likely cause the Department of Justice (DOJ) and the Federal Trade Commission (FTC) to step in and stop the deal.
DraftKings and FanDuel are also no longer small enough to sneak under the DOJ’s and FTC’s radar. A recent valuation of the companies has them sitting at more than $1 billion. The nature of the websites and controversy of online gambling is also likely to draw attention to any planned merger, Fortune notes.
