Paddy Power Betfair was formed in 2016 and is an international, multi-channel sports betting and gaming operator. Our business is now separated into four operating divisions, Online, USA, Retail & Australia.

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DUBLIN (Reuters) - Paddy Power Betfair (PPB.I) (PPB.L) has agreed to merge its U.S. business with fantasy sports company FanDuel to target the U.S. sports betting market that is set to open up in the coming years, the Irish bookmaker said on Wednesday.
Under the agreement, Paddy Power Betfair will contribute its existing U.S. assets worth $612 million (459 million pounds) along with $158 million of cash to take a 61 percent stake in the combined business, with existing FanDuel investors owning 39 percent.

The Dublin-based company can increase its ownership to 80 percent after three years and 100 percent after 5 years via call and put options at the prevailing market valuations, it added.

“This combination creates the industry’s largest online business in the U.S., with a large sports-focused customer base and an extensive nationwide footprint,” Paddy Power Betfair Chief Executive Peter Jackson said in a statement.

“Together with our substantial financial firepower, we believe we are now well placed to target the prospective U.S. sports betting opportunity.”

Shore Capital today downgrades its investment rating on Paddy Power Betfair (LON:PPB) to sell (from hold).

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Paddy Power Betfair said its US operations had completed a merger with FanDuel after the deal was first flagged in May.

The new company would be called FanDuel Group and operate a portfolio of brands including FanDuel, TVG, Betfair Casino and Draft.

Paddy Power Betfair said it owned 61% of FanDuel Group, with existing FanDuel investors owning 39%.

StockMarketWire.com
Paddy Power Betfair said subsidiary FanDuel Group had entered into an agreement with Boyd Gaming to co-operate in the US sport betting and online casino markets.

Under the terms of the agreement, which was subject to favourable legislation and regulatory approvals, FanDuel would gain market access in several states.

Boyd Gaming would take a 4% equity stake in FanDuel and have an option to purchase a further 1% stake.

The agreement would cover all states where Boyd Gaming currently held gaming licenses, excluding Nevada, and any states in which it acquired a gaming license or market access in the future.

The agreement, along with FanDuel's existing market access deals in New Jersey, New York and West Virginia, meant it will potentially have access to 15 states nationwide, Paddy Power said.

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Paddy Power Betfair downgraded its annual earnings guidance after higher revenue was offset by new gambling taxes in Australia and it incurred losses from its US fantasy sports business.

Pre-tax profit rose to £106m, as revenue rose 5% to £867m.

Underlying Ebitda fell 1% to £217m and the company said it expected to post a full-year figure of between between £460m and £480m. The new guidance compared to a previous range of £470m and £495m.

On a constant currency basis, revenue in the first half rose 7% with a big improvement recorded in the second quarter, owing, in part to the Word Cup.

Revenue in the second quarter rose 13% on a constant currency basis, after it was flat in the first quarter.

Paddy Power Betfair declared an interim dividend of 67p, up 3% on-year.

'It has been a busy and successful few months for Paddy Power Betfair,' chief executive Peter Jackson said.

'We have made substantial progress against our strategic priorities and trading in the second quarter was good, with all brands and operating divisions contributing to the group's double-digit revenue growth.'

'The World Cup was a showcase event for Paddy Power, with a series of successfully executed marketing campaigns leading to it being one of the UK's most talked about brands in social media conversations around the tournament.'

'In Australia, despite significant upcoming tax headwinds, Sportsbet continues to target further market share gains by using its scale to increase investment in marketing, product and its value proposition.'

'We now have much better visibility of the regulatory and fiscal changes in the UK, Australia and the US, and believe that our scale, leading customer propositions and strong balance sheet mean we are well positioned to build a business that can generate sustainable shareholder returns over the long term.'

Barclays Capital today reaffirms its overweight investment rating on Paddy Power Betfair (LON:PPB) and cut its price target to 7500p (from 7730p).

StockMarketWire.com
Gambling company Paddy Power Betfair slightly upgraded its annual guidance after a strong sales performance in its new US business in the third quarter offset weakness in UK retail and Australia.

Underlying Ebitda on a reported basis for the three months through September fell 16% to £101m, even as revenue rose 12% to £483m.

However, proforma Ebitda adjusted for US sports betting and tax changes rose 3%, or by 6% on a constant currency basis.

The proforma figure assumed that US business FunDuel, which was acquired on 10 July, had always been part of the group for the reporting period.

Paddy Power Betfair said it now expected annual underlying Ebitda, pre-US sports betting to be between £465m and £480m, upwardly narrowing its previous guidance of between £460m to £480m.

The guidance, however, was given the caveat of 'not withstanding negative sports results in Australia'.

US sports betting Ebitda losses were expected be around £25m in 2018, reflecting marketing and promotional investment in New Jersey.

In the third quarter, proforma US revenue jumped 22%, while online revenue rose 15%.

Retail revenue fell 4%, with UK shops down 1% and Irish shops own 6%, with sports revenues impacted by weaker margin.

Australian revenue fell 2%, impacted by sports results.

'The third quarter was a good quarter for the group,' chief executive Peter Jackson, said.

'In Europe, the encouraging momentum that we saw in the second quarter accelerated further, with online revenue up 15%.;

'This momentum, which was evident in both Paddy Power and Betfair, is driven by enhancements in product and good execution in promotions and marketing.'

In Australia, Jackson said the company continued to see very good scope to target additional market share gains.

'In the US, the exciting potential of the sports betting opportunity and the strength of our strategic positioning has been evidenced by our experience to date in New Jersey.'

'FanDuel recorded a 30% share of the sports-betting market in September, driven by a market-leading customer proposition, our strong brand presence and the ability to cross-sell from our fantasy sports player base.'

'Overall, we are pleased with the substantial progress we continue to make against our strategic priorities.'

'Our continued investment in brands and customer proposition means that all our businesses will exit the year with enhanced competitive positioning.'

'Together with our scale and strong balance sheet this means we are better positioned to face the significant regulatory and fiscal headwinds that apply next year and to capitalise on the long-term industry growth opportunity.'

Peel Hunt today reaffirms its reduce investment rating on Paddy Power Betfair (LON:PPB) and cut its price target to 6000p (from 7500p).

UBS today upgrades its investment rating on Paddy Power Betfair (LON:PPB) to neutral (from sell) and cut its price target to 6950p (from 7130p).