Golden Nugget Online Gaming, Inc. (NASDAQ: GNOG) is engaged as an online gaming company, which was the first to bring live dealer and live casino floor to the U.S. online gambling market. Shares of the iGaming company jumped 51% through trading on Monday, August 9, 2021. Over the past three months, Golden Nugget Online Gaming has seen average daily volume of 1.01 million shares. However, volume of 35.5 million shares or dollar volume of $656.75 million, exchanged hands during Monday’s trading session.
Shares of Golden Nugget Online Gaming, Inc. soar after the company announced entering into a definitive agreement to be acquired by DraftKings, Inc. (NASDAQ: DKNG). As a result of the acquisition, DraftKings will utilize a holding company reorganization, but will retain its existing name of “DraftKings, Inc.” post reorganization.
Under the terms of the agreement, Golden Nugget shareholders will receive 0.365 common shares of the newly-combined DraftKings holding company for each common share of GNOG held. Although both of the company’s board of directors has approved the acquisition deal, Golden Nugget shareholders will have their chance to approve the agreement.
DraftKings Sees Strong Synergies With Golden Nugget
DraftKings sees strong synergies with Golden Nugget Online Gaming, which are estimated to total $300 million at maturity. The newly-combined company will have the opportunity to leverage multiple brands with cross-selling opportunities to ultimately gain market share and revenue growth.
Aside from revenue growth synergies, DraftKings management sees “multiple channels for cost savings,” such as eliminating platform costs due to migrating GNOG’s technology over to the in-house DraftKings technology platform.
In addition to acquiring Golden Nugget Online Gaming, Inc., DraftKings has entered into a separate commercial agreement with Fertitta Entertainment, Inc. and its asset portfolio. Fertitta boasts a significant asset portfolio consisting of the Houston Rockets, Golden Nugget, LLC, and Landry’s LLC. This means DraftKings will have marketing & sponsorship opportunities with the Houston Rockets, an expanded sportsbook, and more.
“Our acquisition of Golden Nugget Online Gaming, a brand synonymous with iGaming and entertainment, will enhance our ability to instantly reach a broader consumer base, including Golden Nugget’s loyal ‘iGaming-first’ customers,” said Jason Robins, DraftKings’ CEO and Chairman of the Board. “This deal creates meaningful synergies such as increased combined company revenues driven by additional cross-sell opportunities, loyalty integrations and tech-driven product expansion as well as technology optimization and greater marketing efficiencies. We look forward to Tilman being an active member of our Board and one of our largest shareholders.”
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