DraftKings Completes Acquisition Of Golden Nugget Online Gaming

On Thursday morning, DraftKings Inc. made a significant move in the realm of online sports betting and online casinos by successfully acquiring Golden Nugget Online Gaming, Inc.

DraftKings will expand its reach through the move, which will solely affect Golden Nugget’s online properties.

Let’s delve into the specifics of Thursday’s acquisition.

DraftKings acquires Golden Nugget Online Gaming

By acquiring GNOG, DraftKings gains the opportunity to expand its customer base by utilizing the well-established Golden Nugget brand, among other benefits.

In addition, the integration of DraftKings’ comprehensive technology framework and Golden Nugget Online Gaming’s distinct features, like Live Dealer, will strengthen the iGaming product portfolio of the merged company.

Jason Robins, Chairman and CEO of DraftKings, expressed his excitement about acquiring Golden Nugget Online Gaming, emphasizing the synergies it brings to their business. He believes that this acquisition will result in significant revenue growth by leveraging their data-driven marketing capabilities, implementing a dual brand iGaming strategy, and exploring opportunities for gross margin improvement and cost savings in external marketing and SG&A. Robins also expressed pride in welcoming the Golden Nugget Online Gaming team to the DraftKings family.

Fertitta Entertainment will retain ownership of the brick and mortar Golden Nugget casinos, as they are not part of the acquisition.

DraftKings’ plans for GNOG

DraftKings is set to reap substantial advantages from the GNOG acquisition, with an anticipated $300 million in synergistic benefits once fully realized.

DraftKings aims to implement a multi-brand strategy to improve the potential for cross-selling and boost revenue growth. Additionally, the company will explore various avenues for cost savings, which will entail:

• Identifying greater returns on advertising investments due to improved marketing efficiencies.
• Removing platform expenses associated with transferring Golden Nugget Online Gaming’s existing technology to DraftKings’ proprietary in-house platform.
• Cutting down on general and administrative expenses, including vendor services and unnecessary overhead.

In addition, DraftKings and Fertitta Entertainment anticipate transforming some existing and upcoming retail sportsbook venues at Fertitta Entertainment-owned Golden Nugget properties into DraftKings sportsbooks through rebranding efforts.

Tilman Fertitta, Chairman and CEO of Golden Nugget Online Gaming, expressed his belief that the alliance formed in the digital sports, entertainment, and online gaming industry will be unparalleled. With the acquisition now finalized, he eagerly anticipates the promising prospects for our combined company and is optimistic about the tremendous success this partnership will achieve.

Thomas Winter, formerly the President of Golden Nugget Online Gaming, is set to join DraftKings as the General Manager of North America iGaming. As part of their integration plan, DraftKings will incorporate employees from Golden Nugget Online Gaming into various positions within their business.

How it will impact both platforms

Golden Nugget Online Gaming is anticipated to join DraftKings’ in-house technology, resulting in cost savings through the reduction of third-party platform costs, operating expenses, and vendor costs.

Furthermore, upon integration, customers from both brands will be able to make use of DraftKings’ cutting-edge technology and enjoy a wider range of product offerings and enhanced features.

In addition to the expanded features, there will be in-house live dealer and proprietary games.

Where DraftKings, GNOG stand in Michigan

Bay Mills Resort & Casino in Brimley has chosen DraftKings as its online operator in Michigan. Similarly, Ojibwa Casinos in Baraga and Marquette have selected Golden Nugget as their operator.

In terms of revenue, DraftKings has claimed the position of Michigan’s second highest-grossing online casino. Since the legalization of online casinos in the state, it has amassed a total of $245.5 million. On the other hand, Golden Nugget has generated a cumulative revenue of $68.3 million in the state.

In terms of online sports betting, DraftKings holds the third position in Michigan for its all-time online handle, totaling $1.28 billion, and ranks third in sports betting revenue, amounting to $66.6 million. On the other hand, Golden Nugget has accumulated $13.5 million in online handle and a mere $1.1 million in sports betting revenue.