Dublin-based Flutter Entertainment, which owns Paddy Power, an international sports betting company, is moving its base to the U.S. and will soon also move its primary listing to the New York Stock Exchange, recognizing the huge growing potential of the American market, the Daily Telegraph reported.
In the past five years, Flutter’s FanDuel has grown to become one of the top sports betting companies in the U.S., beating established gaming brands such as BetMGM, Caesars Sportsbook, and DraftKings. At the same time, the U.S. market is the fastest growing in the world.
Earlier this year, Flutter CEO Peter Jackson called the U.S. the company’s “natural home.” This is in response to the market’s explosive growth since the 2018 decision by the U.S. Supreme Court that the federal law banning the activity was unconstitutional.
This opened the floodgates as more than 30 states now allow legal sports betting.
U.S. operations generated $4.5 billion last year, compared to $3 billion in the U.K. and Irish market. It accounts for 38 percent of the company’s profits. One reason the company wants to move to the NYSE by the end of this year is the hope of being included in the S&P 500.
The news that Flutter wants to move its primary share listing became known about two months after the company debuted on the NYSE Jan. 29. The question will be put to shareholders at their annual meeting in May. Flutter is the second largest gaming company on the exchange, with Las Vegas Sands as first.
William Woodhams, chief executive officer of the bookmaker Fitzdares, told the Telegraph: “What Flutter has done is been strategically ahead of everyone on everything.” A few days after the 2018 Supreme Court ruling, Flutter purchased a majority in FanDuel, a fantasy sports app that later became a major sports betting operator. Woodhams added “Everyone knew what was going to happen in America and everyone knew you’d have to throw a lot of money at it.”
FanDuel had an existing large, enthusiastic base in place and had already acquired celebrity endorsements from Snoop Dogg and Floyd Mayweather.
Unlike many European markets, the U.S. hasn’t tamped down on sportsbook advertising, and it often crowds out other products during televised sports events.
Woodhams added, “FanDuel was there to provide a product for 21-year-old jocks who didn’t want to bet illegally. By that point it had this amazing database of people that you knew would just start gambling.”
PKC Gaming & Leisure Consultancy CEO Paul Girvan told the Telegraph: “Americans are just as passionate if not more passionate about betting. And they’ve got more sports they tend to bet on.”
According to the American Gaming Association, the U.S. sport betting market in 2023 was $120 billion, a 27.5 percent increase over the year before. That is about $10 billion in revenue for American sportsbook companies.
Recently Flutter told investors that it anticipates the market for sports betting and iGaming to grow to $40 billion by 2030.
The virtual gold nuggets glistening on the ground infected most sports betting companies in the U.K., but only Flutter has managed to strike it rich. This is due to high costs and having to deal with different regulations for every state that other companies weren’t able to navigate.
Sometimes it required spending a lot of money to lure new customers with free bets and promotions. By last spring, Flutter was spending about $290 for each new customer. Jackson commented, “Last year, we had to pay to acquire those customers. This year, those customers delivered a positive contribution, and of course, we’ll also acquire a whole bunch of new customers as well.”
Smaller companies couldn’t afford to compete in such a market and have pulled out of the U.S. For example, 888 Holdings, which owns William Hill, began selling off its U.S. business.
The advertising of sports betting has in Europe created a strong reaction, unlike in the U.S. Gaming columnist Andrew Tottenham declared, “What we don’t understand is there’s a lot of people out there who don’t like it, don’t want it, don’t want it in their living room and don’t want this constant barrage. It is creating a backlash, and that will feed into what happened over here, which is more restrictions on the industry.”
Critics of gambling, such as the U.K.-based Gambling With Lives, predict that attitude will eventually be exported to the U.S. Charles Ritchie, who founded that charity, said, “More access to mass-advertised, highly addictive products will not only mean more people addicted but many more suicides, and the government will be forced to act.”
