FTC blocks FanDuel DraftKings merger
The US Federal Trade Commission has filed a suit to block the merger between the DFS giants.
US.- The merger between FanDuel and DraftKings is reportedly coming to an end as the US Federal Trade Commission (FTC) announced the authorisation of legal action to block the project of the two DFS giants.
The FTC released a statement yesterday where it was detailed that the merger attempted against a free market, as the “combined firms would control more than 90 percent of the US market for paid daily fantasy sports contests.” 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.
Moreover, 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. “The FTC is committed to the preservation of competitive markets, which offer consumers the best opportunity to obtain innovative products and services at the most favorable prices and terms consistent with the provision of competitive returns to efficient producers,” he added.
Despite the complaints, it was clarified that they still haven’t proved that the companies violated any laws. “These filings do not constitute a finding that any violation of law has occurred. The request for preliminary relief will be assessed in federal court, while the merits of the complaint will be assessed in an administrative trial subject to review by the FTC and ultimately by federal appellate courts,” said the FTC in the release.
Jason Robins and Nigel Eccles, DraftKings and FanDuel CEOs, released a joint statement where they said that they’re disappointed by the decision and continue to believe that a merger is in the best interests of their players, companies, employees and the DFS industry. “We are considering all our options at this time. As we work together to determine our next steps, we would like to thank DraftKings and FanDuel players, partners and employees for their patience, support and continued loyalty,” they added.
