[ad_1]
A New York arbitrator has settled a long-running legal dispute between fantasy sports and FanDuel’s parent betting company Flutter and Murdoch’s media conglomerate Fox, with both sides claiming victory.
Fox must pay at least $3.7 billion (€3.7 billion) if it decides to exercise its option to take an 18.6 percent stake in FanDuel, the decision said.
Fox filed an arbitration claim against Paddy Power owner Flutter in April last year, demanding a lower price for a minority stake in FanDuel, valued at $11.2 billion from when Flutter raised its funding to the business in December 2020.
But the New York District Court of Arbitration and Mediation ruled Friday that Fox’s option must be based on a $20 billion valuation and a 5 percent annual ratchet, meaning Fox must pay it now. more than $4 billion in equity. Fox has until 2030 to exercise its option.
The decision represents a victory for Flutter, which was forced to buy the small bank at a premium if it had lost.
“[The] “The decision gives us confidence in our position on this issue and a clear understanding of what it would cost Fox to buy into this business, should they wish to do so,” said Peter Jackson. , CEO of Flutter.
The values of sports betting companies have increased in recent years as a wave of states have legalized the practice and many customers have come on board. Sports finance revenue was $4.3 billion last year and will nearly triple by 2025, according to Morgan Stanley.
Media companies are vying for a share of the growing market. ESPN is considering a licensing deal with rival betting company DraftKings. In August, Fox CEO Lachlan Murdoch told investors that sports betting was “a huge opportunity” for Fox Sports.
Fox also claimed victory from the decision, saying its 10-year option for a position in the “market-leading US online sports betting industry” confirmed its “value big” he created for shareholders because the sports betting industry is a “primary partner”.
Fox added that Flutter could not have a public listing on FanDuel without Fox’s “consent and approval from the referee”. But Flutter denied that Fox could block an IPO, saying a separate decision would determine Fox’s role in a possible timeline, with a decision in the first half of next year. now.
The Murdoch media group acquired its option to buy an 18.5 percent stake in FanDuel at fair market value as part of Flutter’s £10 billion merger with the Stars Group, which controlled a platform sports betting with Fox.
The arbitrator dismissed Fox’s claim that Flutter mishandled the FoxBet brand, which is currently available in only four US states. – Copyright The Financial Times Limited 2022.
[ad_2]
Source link
