Flutter Move Sets up FanDuel-ESPN BET Rumors (2024)

A corporate board shakeup has ignited rumors that the nation’s highest-grossing sportsbook could add one of the sports industry’s most prominent names.

Flutter Move Sets up FanDuel-ESPN BET Rumors (1)

Ryan Butler • Senior News Analyst

Jul 8, 2024 • 17:10 ET • 4 min read

A corporate board shakeup has ignited rumors that the nation’s highest-grossing sportsbook could add one of the sports industry’s most prominent names.

FanDuel parent company Flutter Entertainment announced last week it had appointed former long-time Disney CFO Christine McCarthy to its board. Not long after, reports circulated Flutter could be involved in a deal that would land ESPN BET.

The report, first attributed to the TheDeal.com, remains a rumor. The logistics of such a deal seem difficult if not impossible. But it furthers the prospect of an unquestioned leader in U.S. digital gaming.


Flutter, the European digital gaming owner of Betfair and Paddy Power, acquired FanDuel shortly after the 2018 U.S. Supreme Court ruling that overturned the federal wagering ban. Bolstered by the company’s tech platforms as well as FanDuel’s name recognition and player database from years as one of America’s two major daily fantasy sports operators, FanDuel has emerged as the U.S. sports betting market share leader.

PENN Entertainment, the Pennsylvania-based operator of America’s largest portfolio of brick-and-mortar properties, has had far less success with digital gaming. The company spent more than $500 million to acquire Barstool Sportsbook as a marketing and branding asset. It spent another $2.1 billion acquiring Toronto-based theScore, largely for its back-end tech system.

ICYMI: Flutter announced last week that former long-term Disney CFO Christine McCarthy would join its board; rumors have since circulated that $FLUT may work with Boyd on a proposed acquisition of Penn Entertainment - one that could lead to a deal with FanDuel for ESPN Bet

— Ryan Butler (@ButlerBets) July 8, 2024

By 2023, and holding onto low single-digit national market share, PENN ditched Barstool and pivoted to a branding deal with Disney owner ESPN to license the most popular name in American sports media. More than six months after ESPN BET’s launch, PENN is still seeing low single-digit national market share - and rising costs associated with the 10-year, $1.5 billion ESPN deal.

PENN’s digital struggles have renewed shareholder frustration with the company’s direction, amplified by a May 31 letter from a prominent investor group asking leadership to give up on digital ambitions. A month later, reports swirled that Boyd Gaming, another major regional casino operator, may be looking to take over one of its biggest competitors.

Last week's Flutter board announcement sparked another possible player in what would be one of the industry’s most significant deals in years.

Next steps

Boyd has focused on its brick-and-mortar strategies and largely avoided online sports betting beyond an eponymous mobile sportsbook only available in Nevada. Acquiring the rights to PENN’s large roster of casinos would appear to make sense, but taking on the multibillion-dollar digital gaming arm would mark a drastic strategic shift.

This reinforces Flutter’s impact. The company owns no physical gambling properties but is a global leader in digital offerings. Boyd, which owns 5% of FanDuel, could take on PENN’s brick-and-mortar portfolio; Flutter may be willing to take a chance on ESPN BET.


No company has confirmed such a deal. Getting to that point would not come easily.

Combining two of the nation’s largest brick-and-mortar casino operators would raise competitive questions from federal regulators. The Biden Administration has been particularly aggressive in blocking corporate mergers and acquisitions it deems anti-competitive.

If approved, the deal would also assuredly require a series of property sales, setting up a further ripple effect of deals as well as state and federal regulatory requirements. Eldorado Gaming’s 2020 deal for Caesars involved far fewer properties and still required the new company to divest itself of many of its assets (and that was under a Trump Administration far more amenable to major corporate deals).

Flutter’s involvement creates a logical buyer for PENN Digital and a new set of regulatory questions.

FanDuel along with DraftKings have what is becoming a de facto sports betting duopoly; regulators may not like seeing one of those two take up an even greater chunk of the market. Disney would also have a say in a deal where a different company operates that property.

That’s on top of the potential financial difficulties of Boyd acquiring the larger and more valuable PENN. There are also questions as to why Flutter would support taking on a sportsbook that is losing money and offers few technological advantages over its current American flagship brand.


Still, the possibilities for Boyd to become the clear U.S. leader in brick-and-mortar gaming and Flutter to cement itself as the No. 1 digital operator may be too much for both companies to pass up.

Regional U.S. casinos such as those operated by PENN and Boyd have remained steady if not spectacular revenue generators. Unlike “destination” resort casinos such as those on the Las Vegas Strip or the Atlantic City boardwalk, regional casinos have more consistent, reliable customer bases and are less affected by seasonality, travel costs, or other macro-level economic factors.

ESPN, despite its own recent struggles, is still the biggest name in US sports media. Even with hundreds of millions of dollars building the FanDuel name, there is value in bringing the ESPN brand under the Flutter umbrella. McCarthy, formally Disney’s top financial exec, knows that value – and, potentially, what it might take to get it associated with a new sports betting partner.

Boyd and Flutter, in this hypothetical scenario, would be the ones coming away with PENN’s assets, but it may be the latter’s shareholders who most support the deal. While the would-be acquirers have seen their respective share prices grow in the low single digits in the past five weeks, PENN has seen a more than 38% jump.

That, not coincidently, has come after the publication of the investor letter asking for a major shift in company strategy.

Bottom line

It remains to be seen if PENN would undertake such a drastic shift. But there’s clear interest – and some logical potential pieces – if PENN, Boyd, and Flutter worked together on what would be one of the most consequential corporate decisions in recent U.S. gaming history.

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