Flutter outlines post-TSG merger business reshuffle
TSG US brands to be reported alongside FanDuel Group as larger group looks to consolidate Paddy Power and SBG into new UK and Ireland division
Flutter Entertainment’s multi-billion-pound merger with The Stars Group (TSG) will complete on May 5 following clearance from shareholders and competition regulators.
The newly merged behemoth will establish a new US division made up of TSG’s US operations Fox Bet and PokerStars and FanDuel Group.
Meanwhile Paddy Power Betfair, Sky Betting & Gaming (SBG), TSG international division and its Australia-facing brands will remain as five separate reporting businesses.
The combined group will report its full year 2020 earnings on this basis.
Paddy Power Betfair will then merge with TSG’s international division before the combined Flutter Entertainment business moves to a four-division operating model, as Paddy Power and SBG move alongside each other to form a new UK and Ireland division.
“Each of these organisational changes will be managed with the primary objective of maintaining momentum within each business as the group looks to achieve the potential revenue and cost benefits of integration,” said Flutter Entertainment in a note to investors.
Flutter CEO Peter Jackson paid tribute to outgoing TSG CEO Rafi Ashkenazi, who will move into a consultancy-based role post-merger advising the combined group on strategy and integration.
“He has been instrumental in transforming TSG from a single product operator to a diverse global leader with multiple product offerings,” said Jackson. “I know that his experience and expertise will bring valuable perspective to our board as we bring our two businesses together,” he added.
Ashkenazi took to his LinkedIn to post: “It has been an absolute pleasure and a privilege to work with so many people in the industry, including CEOs of many of our competitors. The company is closing one chapter but opening a new one, a very exciting one. thank you all.”
Hailing a “new era” for the combined group, Jackson said the business would be free to approach the future with confidence in what he called uncertain times following Covid-19.
Flutter Entertainment’s share price rose by 7% in early trading.