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February 16, 2024

DraftKings Acquires Jackpocket: Expanding into U.S. Lottery Market and Strengthening Position in Sportsbook and iGaming

Clara Williams
Written byClara WilliamsWriter
Researched byAishwarya NairResearcher

Introduction

DraftKings Inc. has announced its agreement to acquire Jackpocket, the leading lottery app in the United States, for approximately $750 million. This acquisition will allow DraftKings to enter the rapidly growing U.S. digital lottery market and strengthen its position in the Sportsbook and iGaming sectors.

DraftKings Acquires Jackpocket: Expanding into U.S. Lottery Market and Strengthening Position in Sportsbook and iGaming

Key Points

  • DraftKings will acquire Jackpocket, the top provider of digital lottery services in the U.S., for $750 million.
  • The acquisition will be funded by cash from DraftKings' balance sheet and Class A common stock.
  • Jackpocket's proprietary technology and strong brand will enhance DraftKings' customer lifetime value and acquisition capabilities.
  • The transaction is expected to drive significant revenue and Adjusted EBITDA growth for DraftKings in fiscal years 2026 and 2028.

Details of the Transaction

Under the merger agreement, Jackpocket stockholders will receive approximately $750 million in total consideration, consisting of cash and DraftKings' Class A common stock. The stock consideration will be subject to a collar mechanism to ensure a minimum value.

The Proposed Transaction has been approved by the Boards of Directors of both DraftKings and Jackpocket and is expected to close in the second half of 2024, pending regulatory approvals.

Benefits and Impact

The acquisition of Jackpocket will enable DraftKings to expand into the U.S. lottery industry and strengthen its position in Sportsbook and iGaming. The transaction is expected to drive significant revenue and Adjusted EBITDA growth for DraftKings in fiscal years 2026 and 2028.

Responsible Gaming

DraftKings and Jackpocket are committed to responsible gaming and provide tools and resources to encourage responsible gaming behavior. The Proposed Transaction will allow DraftKings to safely and responsibly expand the lottery category, generating more revenue for states to fund important programs.

Conclusion

The acquisition of Jackpocket by DraftKings represents a strategic move to enter the U.S. lottery market and strengthen its position in the Sportsbook and iGaming sectors. This transaction is expected to drive significant revenue and Adjusted EBITDA growth for DraftKings in the coming years. Both companies are committed to responsible gaming and providing a convenient and fun way to participate in the lottery.

About the author
Clara Williams
Clara Williams
About

Clara "LottoLore" Williams, a Kiwi with a zest for numbers and narratives, dives deep into the thrilling world of lotteries. As a leading writer for LottoRank, her pieces resonate with enthusiasts, offering a harmonious blend of data, history, and human interest.

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