Menu

Everything you need to know about DraftKings and Golden Nugget Merger

In mid-August, the Golden Nugget Casino and the Daily fantasy sports operator DraftKings agreed to team up to increase their respective market shares. Undeniably, the transaction surprised many because it’s a unique deal. Indeed, the merger saw stocks change hands for approximately $1.56 billion, which DraftKings forked out on August 8th.

What’s more, following the news, GONG stock jumped from $12.35 when the market opened on August 9th. And shares closed at $18.50 the next day. Then further increased days after to $19.95.

DraftKings (DKNG) shares, on the other hand, had a similar jump on opening at $51.59 to 52.36 and days later to $54.61. This shows it’s not only the CEOs of the 2 businesses that see value in this transaction. But, market analysts, brokers, and traders also foresee that this deal will benefit everyone.

DraftKings and Golden Nugget

Golden Nugget Online Casino$10 FREE! Bonus Code - OCNJ10
100% Bonus up to $1000!
Get Cashback on your Deposits
Visit Casino
Review

Understanding the factors that have motivated this transaction

As we understand, the primary motivating factor for DraftKings to buy Golden Nugget online casino is the company’s top reputation. In fact, if you remember, a while ago, Draftkings’ competitor Fanduel made a similar move when Betfair bought the DFS operator because of the brand recognition in the states. Now, of course, in this case, it’s a DFS that’s buying out an online casino, not the opposite. But it’s easy to make a parallel between the 2 ventures.

Another motivation for Draftkings to buy out the Golden Nugget online casino is their massive database. Indeed, the 5 million patrons currently registered on the Golden nugget online casino give them a unique opportunity to integrate a share loyalty scheme, upsell and cross-sell products. And, of course, mutually grow their coffers too.

The obvious player perks for DraftKings and Golden Nugget merger

First and foremost, the most noticeable change that’ll take place imminently is the Golden Nugget’s migration onto Draftkings’ proprietary backend, which is robust and will reduce costs. So as a casino player, it’s likely you’ll see an increase in uptime, more competitive odds, and faster loading time for slots and live casinos. At least, one might think.

Then as we briefly hinted above, both the Nugget and Draftkings will share a loyalty scheme soon. Hence, you’ll have twice the chance to get rewarded. But more importantly, if you’re a Golden Nugget player, you’ll now have the opportunity to earn comps on new products.

Now because both operators will merge their marketing budgets and ideas, it’s also likely that you’ll see bigger promotions thanks to their savings on marketing and overhead.

Plus, the exclusive commercial deal with the Rockets should add value to patrons’ experience.

Expanding their retail sportsbook presence – what could that mean?

Above we gave you the main reason for the core deal. However, Fertitta Entertainment, Inc., Tilman Fertitta company, will also benefit from it. In fact, the deal also calls for the Toyota Center to have its betting shop (pending approval from the regulator). Plus, around 500 outlets are also somewhat tied into this deal. And, Fertitta isn’t selling them as of now, as we understand. So, if the company wants to grow its retail presence in online gambling to include the sports betting scene, these restaurants could become a great place to buy branded sports merchandise.

To conclude about the DraftKings and Golden Nugget merger

All and all, there are many facets to this agreement. And it’s hard to crunch them all in such a short piece. But what we do know is that the company’s acquisition will generate around $300mm once it reaches maturity. And that has to be music to shareholders’ ears, including Tillman Fertitta, who agreed to have 46% of its GONG share converted into DKNG equivalents which he’ll keep for a minimum of 1 year.

DraftKings and Golden Nugget

Golden Nugget Online Casino$10 FREE! Bonus Code - OCNJ10
100% Bonus up to $1000!
Get Cashback on your Deposits
Visit Casino
Review