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Paddy Power Betfair agrees deal to merge its US operations with fantasy sports firm FanDuel

The bookmaker said it will contribute its existing US assets as well as US$158mln of cash, which will be used to pay down existing FanDuel net debt which stood at US$76mln at the end of March
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Paddy Power Betfair will have 61% ownership of the combined business and FanDuel investors will own 39%

Paddy Power Betfair PLC (LON:PPB) announced late on Wednesday that it has agreed a deal to merge its US operations with US fantasy sports firm FanDuel Inc.

The FTSE 100-listed bookmaker said it will contribute its existing US assets as well as US$158mln of cash, which will be used to pay down existing FanDuel net debt which stood at US$76mln at the end of March.

READ: Power Betfair up as it confirms talks to buy FanDuel

Paddy Power Betfair will have 61% ownership of the combined business and FanDuel investors will own 39%. The Irish group will also have an option to take its ownership of the business to 80% after three years and to 100% after five years.

The Irish group aid the deal strengthens its opportunity to target the prospective American sports-betting market, after a US Supreme Court ruling opened the door to legal sports betting across the country last week.

FanDuel, which is headquartered in New York, had revenue of US$124mln and 1.3mln active customers in 2017, with a 40% market share of the US daily fantasy-sports market.

In morning trading in London on Thursday, Paddy Power Betfair shares were up 3.3% at 8,915p.

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