DraftKings and FanDuel lost $151m
Leaked documents from the companies revealed that the DFS giants lost US$151 million last year.
US.- The biggest DFS companies, DraftKings and FanDuel, have lost US$151 million combined in 2016. The news that were revealed by Axios detailed the financial numbers on a 106-page document.
The report establishes that DraftKings generated US$160 million in revenue in 2016, and operating loss of US$92 million. On the other hand, FanDuel collected US$91 million during the first ten months of last year, whilst registering US$59 million of earning loss. The companies were hoping to increase their numbers by merging their businesses, but in a move that surprised both of them, the US Federal Trade Commission (FTC) announced the authorisation of legal action to block the project of the two DFS giants.
Earlier this week the FTC detailed that the merger attempted against a free DFS market, as both firms would’ve controlled approximately 90 percent of the entire industry. The Federal Trade Commission, along with the Offices of the Attorneys General in the District of Columbia and California will jointly file a complaint in federal district court in order to obtain a preliminary injunction to stop the attempts from FanDuel and DraftKings to become one.
The commission also complained that the proposed merger is in violation of the Section 7 of the Clayton Act and Section 5 of the FTC Act. Tad Lipsky, Acting Director of the FTC’s Bureau of Competition, said that the merger would deprive customers of the substantial benefits of direct competition between both companies. Despite the complaints, it was clarified that they still haven’t proved that the companies violated any laws.
