Paddy Power Betfair may look again in US after Draft acquisition
Irish gambling giant’s CEO Breon Corcoran says firm’s appetite in States could expand
Paddy Power Betfair’s chairman Gary McCann and chief executive Breon Corcoran: will pay up to $48 million (€37 million) for Draft. Photograph: Eric Luke
Paddy Power Betfair may look at other deals in the US following its purchase there of fantasy sports business, Draft, according to chief executive Breon Corcoran.
The Irish gambling giant will pay up to $48 million (€37 million) for Draft, expanding its presence in the US where it already has racing, betting and casino businesses.
After Paddy Power Betfair’s annual general meeting in Dublin, Mr Corcoran said the group had an appetite for more deals in the US, depending on how the betting market there opened up. “I would hope that we would do more there,” he said.
Betting is illegal in many parts of the US, but the fantasy competitions offered by Draft are not. The company’s customers “recruit” teams of players in football and other sports, who earn points according to their performance, and compete against each other for cash prizes.
Draft offers daily competitions to its customers. Co-chief executives Jeremy Levine and Jordan Fliegel run the business, which has 10 staff in all. Paddy Power Betfair paid an initial $19 million for the company, and could pay a further $29 million, depending on its performance .
Technology and marketing
While he did not rule out expanding it to Paddy Power Betfair’s other businesses in Europe and Australia, Mr Corcoran stressed that the group’s initial focus would be on aiding Draft’s growth in the US.
“These are 10 guys with a passion and a vision for their business and we can help them a bit with technology and marketing,” he said.
The group’s TVG horseracing TV service is watched in about 36 million homes and it has a 30 per cent share of online betting on the sport. It operates a regulated casino in New Jersey where its slice of the market stands at 12 to 13 per cent.
Mr Corcoran indicated the group was not concerned about the likely impact of a government review of gaming machines – known as fixed-odds betting terminals – on betting shops in the UK. “We are comfortable with our ability to trade through it,” he said.
Concerns that the machines are leading to an increase in problem gambling have prompted calls for tougher regulation of their use in betting shops, including a proposal to cut maximum single stakes to between £10 and £20 from £100.