Paddy Power Betfair buys US fantasy sports firm Draft

Fantasy Sports

Paddy Power Betfair has entered into the daily fantasy sports market in the United States with the acquisition of an early-stage operator, DRAFT.

The initial cash consideration paid on completion was $19m. Further cash consideration of up to $29m would become payable over the next four years depending on the business’ performance.

It said the business would continue to be run by co-CEOs Jeremy Levine and Jordan Fliegel and would now have access to the group’s marketing and technology capabilities.

The acquisition was said to provide the group with exposure to a “fast-growing” market, and complemented its other businesses in the United States.

DRAFT was mobile-led, with a differentiated product.

To maximise the growth opportunity, substantial marketing investment in the business is envisaged in the next few years, with an EBITDA loss of about $20m forecast in 2017.

Last week Paddy Power Betfair announced a growth in operating profit of 114 per cent in the first three months of 2017 while revenues for the same quarter rose to £82 million (€97m).