The impending multi-billion dollar Flutter Entertainment and Stars Group merger agreement has moved another step closer after the UK Competitions and Markets Authority issued a green-light.
The all-share combination, to be implemented through an acquisition of The Stars Group by Flutter, has been given unconditional phase one clearance by the non-ministerial government department.
Set to boast a combined £1.5bn revenue and encapsulating a number of brands, such as Paddy Power, Betfair and Sky Bet, the CMA focused its investigation on the potential impacts felt by punters as a result of the combination.
In particular this looked at whether, as a result of the deal, customers who choose to place bets online could be offered less favourable odds, less generous promotions or poorer quality products, for example, as a result of reduced innovation in pricing or app experience.
Commenting on its findings and evidence gathered the authority addressed the strong competition for customers that exists among online betting companies: “There are a number of large and small online sportsbook operators, in addition to the merging companies, with whom customers frequently open accounts and to whom they could easily switch. These companies include the large operators, bet365, GVC/Ladbrokes Coral and William Hill.
“The CMA therefore found that, while the merging companies complete closely, they are among a number of close competitors, and the merger will not worsen the offering to people who choose to bet online.”
The proposed transaction remains subject to approval by Flutter shareholders at its extraordinary general meeting on 21 April 2020 and by The Stars Group shareholders on 24 April 2020.
It also remains conditional on approval from a small number of other regulatory bodies, some of whom have indicated that their usual timeframes may be delayed by the current COVID-19 crisis.
Peter Jackson, chief executive of Flutter, welcomed the latest decision: “This morning’s announcement from the CMA marks a further important milestone in the process towards completion of our proposed combination with The Stars Group.
“We continue to work with the remaining international regulatory authorities to obtain the last of the outstanding approvals. Separately last week we published the necessary documentation ahead of the shareholder votes in April and we continue to make good progress in our post-completion planning.”