Merger between betting firms cleared by the CMA
The merger between two of the main online betting companies; The Stars Group, owners of Leeds-based Sky Betting and Gaming and Flutter Group, has been approved following an investigation by the Competition and Markets Authority (CMA).
The investigation focused on 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.
Based on the evidence gathered the CMA has found 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 compete closely, they are among a number of close competitors, and the merger will not worsen the offering to people who choose to bet online.
This is one of several global mergers that the CMA has worked on recently. It has liaised with other competition authorities including the US, Germany and Austria who have also cleared the deal.
The deal is now 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 Group, said: “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.”
Once completed this merger will create the world’s biggest online betting firm and potentially bring £140m of cost synergies as a direct result of it for the group.
