Flutter Entertainment’s US Listing Confirmed for January Target

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Flutter Entertainment, the parent company of FanDuel, is set to make a significant move in the financial world by listing its ordinary shares on the New York Stock Exchange, or NYSE, (pictured) by January 29, 2024.

This move will see its stock delisted from it home country’s Euronext Dublin stock exchange. But it will remain listed on the London Stock Exchange in parallel with its new NYSE listing. However, the company has said that it plans to move entirely to the NYSE as its primary listing at some point in the near future.

Flutter has been considering this change for quite some time, since at least 2021. The Irish operator sees FanDuel and its U.S. sports betting operations as potentially becoming its primary revenue driver, so the move make sense, given shifting priorities in the business.

In that same vein, this year Flutter also appointed a U.S-based chairman in former Kellogg and Coca Cola executive John Bryant.

When the move goes through, Flutter will become the second-biggest gambling company on the NYSE, with a market cap of $28.59 billion. Only Las Vegas Sands, which does not currently operate any U.S. casinos, has a higher market capitalization among gambling operators.

Expanding to the New York Stock Exchange

Flutter’s decision to list on the NYSE, selected after a competitive tender process, is a practical step, given the U.S. is the fastest-growing major market for the company.

This listing allows Flutter to tap into a broader audience of professional and retail investors. Many professional investors avoid stocks that trade over-the-counter because of internal regulations, indicating the NYSE listing could boost buying for Flutter shares.

Concurrent with its NYSE listing, Flutter will delist its stock from Euronext Dublin. The final day of trading on Euronext Dublin will be January 23, 2024, with trading suspended from the close of business on that day to allow for the settlement of pending trades and repositioning instructions.

Flutter has decided to maintain just two listings – on the LSE and NYSE – to minimize regulatory complexities. Despite the new listing in the U.S., Flutter will continue trading on the London Stock Exchange under the ticker symbol “FLTR.” The decision to list on the NYSE will not impact its FTSE 100 status on the LSE.

It’s a move that aligns with the substantial growth Flutter has experienced in the booming U.S. gambling market, primarily due to the success of FanDuel. Acquired in May 2018, FanDuel has evolved from a daily fantasy sports operator to a market-leading U.S sportsbook operator, alongside DraftKings.

U.S. Revenues Attractive

In the third quarter, U.S. revenue reached $839 million (€779 million/£668 million), an 11.7% increase. This growth was £100 million more than the next highest contributor – Flutter’s UK and Ireland business.

U.S. sports betting revenue rose by 10.0% on a constant currency basis, with stakes increasing by 40.0%. However, this was partly offset by a decline in net revenue margin. The online casino segment also saw a 52.0% rise in revenue, with FanDuel casino’s market share increasing to 23.0%, aided by a 42.0% rise in average monthly players.

Flutter’s CEO, Peter Jackson, has expressed optimism about the continued growth of the company’s U.S. business. He highlighted that Flutter was the first U.S. online operator to reach structural profitability, a milestone achieved in the first half of the year. The U.S. business contributed 32.8% of all revenue in Q3, with overall group revenue rising by 7.6% to £2.04 billion ($2.559 billion).

Future Moves Possible

As for the future, there may well be more options that open up after this first U.S. listing. For one, it could give rise to the long-mooted FanDuel spin-off from the main company, which would not be possible without a U.S. listing.

A full move to the U.S. is also almost inevitable. As an Irish-based company, Flutter’s ties to the London Stock Exchange aren’t particularly deep. Plus, the British market is suffering with several high-profile companies dropping out of the exchange in recent years.

Without a primary U.S listing, Flutter can’t be listed on the S&P 500 or the Dow Jones. It also chose the NYSE over NASDAQ, which precludes it from that index as well.

If Flutter’s shares want to make the biggest impact with a U.S. listing, getting into some of those popular indexes will be a priority.

However, there will no doubt be some interested parties either way. A couple could include Boyd Gaming, who may add to their 5% share they already own in Flutter, and Fox Corp., who potentially have rights to 22% of FanDuel after August 2023 saw Flutter pull the plug on struggling sportsbook FOX Bet.

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