Business

Buying DraftKing’s Golden Nugget could result in “sales boost,” CEO says

Draft Kings DKNG,
-14.44%
has completed the acquisition of Golden Nugget Online Gaming to increase revenue and reduce costs. The acquisition was a stock deal valued at about $450 million, a company spokesman told MarketWatch.

“We anticipate that this acquisition will provide significant revenue growth leveraging our data-driven marketing capabilities and a two-brand iGaming strategy, opportunities for gross margin improvement and cost savings in external marketing and SG&A,” said Jason Robins, CEO of Draft Kings, in a Explanation. “I am proud to welcome the Golden Nugget Online Gaming team to the DraftKings family.”

The move will allow DraftKings for sports betting and online gaming to expand its iGaming product offering and increase the new company’s marketing efficiencies. the DraftKings announcement claims.

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DraftKings buys the business from billionaire restaurant connoisseur Tillman Fertitta. The acquisition affects Golden Nugget’s online gaming business and does not include Golden Nugget brick-and-mortar casinos, which will remain owned by Fertitta Entertainment.

DraftKings has been in talks to acquire the online gaming portion of Golden Nugget’s business since 2021.

The acquisition comes amid a turbulent year for DraftKings. In recent months, the company’s stock fell to a new 52-week low, prompting Robins to label people selling his company’s stock as people who “will regret that decision more than any other decision they’ve made.” you have ever met in your life”.

In February, DraftKings announced that Robins’ total compensation for 2021 was $14.03 million, compared to $236.83 million for 2020.

At several points, Robins has indicated that he has a long-term perspective at DraftKings.

“Right now it’s a wild market. I think what we do has been very consistent since day one.” Robins said in February. “I think the model works and we’re going to play the long game here.”

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Shares of DraftKings Inc. fell 10.82% during Thursday trading amid a broad market sell-off that caused the Dow to fall more than 1,000 points. DraftKings is down 72.86% over the past 12 months, compared to a 1.61% decline for the S&P 500 SPX.
-2.58%
Index over the same period.

https://www.marketwatch.com/story/draftkings-ceo-golden-nugget-purchase-could-provide-meaningful-revenue-uplift-11651777289?rss=1&siteid=rss Buying DraftKing’s Golden Nugget could result in “sales boost,” CEO says

Brian Lowry

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