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Wednesday, 1 April 2020

Flutter Entertainment Given Approval For The Stars Group Merger

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Flutter Entertainment has been given approval for its proposed merger with The Stars Group.

This week, the UK Competitions and Markets Authority (CMA) gave Paddy Power owner Flutter Entertainment the green-light to go ahead for its merger with The Stars Group. The merger will be implemented via an acquisition of The Stars Group by gambling operator Flutter Entertainment.

The merger will see the two firms combine and own various leading gambling websites including Paddy Power, Sky Bet, Betfair, and dozens more. Together, the firms will have a combined revenue total of around £1.5 billion, which is one of the reasons the CMA launched an investigation into the deal when it was first proposed.

However, the regulator has found cleared the agreement after finding that there would still be enough companies to compete against the combined group after the merger has gone through. In a statement referring to gambling websites Bet365, William Hill, and Ladbrokes Coral, CMA said:

“The CMA has found that online betting companies compete strongly for customers. There are a number of large and small online sportsbook operators, in addition to the merging companies, with whom customers frequently open accounts and to whom they could easily switch.”

The statement from the regulator continued, saying: “The CMA, therefore, found that, while the merging companies compete closely, they are among a number of close competitors, and the merger will not worsen the offering to people who choose to bet online.”

What They Say

Peter Jackson, the Chief Executive of Flutter Entertainment, said in a statement: “This morning’s announcement from the CMA  marks a further important milestone in the process towards completion with The Stars Group.

“We continue to work with the remaining international regulatory authorities to obtain the last of the outstanding approvals. Seperately last week, we published the necessary documentation ahead of the shareholder votes in April and we continue to make good progress in our post-competition planning.”

Although the merger has been given the approval from the CMA, the deal is still subject to approval by Flutter’s shareholders at the upcoming general meeting on April 21st, 2020. It will also be subject to approval by The Stars Group’s shareholders on a meeting planned for April 24th, 2020.

As mentioned in other reports, numerous other regulatory bodies will also have to approve the merger before it can go ahead. However, amid the current COVID-19 pandemic, the meetings in which approval would be discussed may be postponed due to health and safety concerns. More information when we have it.

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