Flutter Entertainment, which owns Paddy Power, FanDuel, Betfair and other online gaming companies, announced that the Australian Competition and Consumer Commission has given low-level, informal approval for its proposed merger with The Stars Group.
Flutter said the proposed deal is also subject to approval by the Australian Foreign Investment Review Board, as well as other international regulatory bodies.
The approval from the Australian watchdog is seen as a milestone in the group’s attempts to merge with its Canadian counterpart to create what is expected to be one of the world’s largest online gaming businesses.
Alongside the UK, Australia was identified as a jurisdiction where the business combination was expected to meet obstacles. Some questions have been raised in the UK, where regulators are concerned about the company’s market domination.
The deal was announced in October, and Flutter hopes it will close sometime in 2020.
Should the merger be completed, shareholders of Flutter would own about 55 percent of the new company, with Stars Group shareholders would control the remaining shares. The deal is expected to produce pretax cost synergies of £140 million a year, along with opportunities to cross-sell products to one another’s customers in international markets and lower finance costs, the two companies said in October.
The merged group will be boosted by a partnership in the U.S. with FOX Sports, which will have the right to acquire an 18.5 percent stake in Flutter’s FanDuel U.S. business from 2021.
