Boyd Gaming is selling its 5 per cent stake in FanDuel to Flutter Entertainment in a transaction valued at approximately $1.755 billion.
Boyd said that the all-cash transaction will unlock significant value for Boyd shareholders and enable the company to reduce debt.
“This transaction unlocks the tremendous unrealised value that our investment in FanDuel has created for our company,” said Boyd Gaming president and chief executive Keith Smith.
“As a result, we are in a significantly stronger financial position to continue executing our strategy of investing in our properties, pursuing growth opportunities, returning capital to our shareholders, and maintaining a strong balance sheet.”
The transaction is expected to close in the third quarter of this year, subject to regulatory approvals, and values the FanDuel business at approximately $31 billion.
Alongside the sale agreement, FanDuel and Boyd will terminate their existing market access agreements and enter into new agreements which provide Flutter with continued market access but at significantly reduced costs.
This is expected to provide annualised savings of approximately $65 million to Flutter from July 1, 2025.
The new market access agreements will run until 2038 and give Boyd a fixed fee per state from FanDuel’s mobile sports betting operations in Iowa, Indiana, Kansas, Louisiana and Pennsylvania, as well as FanDuel’s online casino operations in Pennsylvania.
FanDuel will also continue to operate Boyd’s retail sportsbooks outside of Nevada through mid-2026, after which time Boyd will assume responsibility for these operations.
As a result of the new market access agreements, Boyd expects its Online segment to generate $50 million to $55 million in operating income and Adjusted EBITDAR in 2025, and approximately $30 million in 2026.
“The partnership between Boyd and FanDuel has been a remarkable success for both companies,” Smith added. “FanDuel has emerged as the nation’s clear leader in online sports-betting, while Boyd has been able to leverage this partnership to profitably participate in the rapid growth of sports betting across the country.
“It has been a privilege to work with the Flutter and FanDuel teams, and we look forward to supporting FanDuel’s continued growth and success through our market-access agreements across the country.”
Peter Jackson, CEO of Flutter Entertainment, commented: “Our acquisition of FanDuel in 2018 is one of the most transformational events in our Group’s history, with its natural competitive advantages combined with access to Flutter Edge capabilities driving impressive growth to become the well-established and clear leader in US online sports betting and iGaming.
“I am really pleased to drive future value for our shareholders by increasing our ownership of FanDuel to 100 per cent. Boyd have been fantastic partners for FanDuel, and we are delighted to be extending our important strategic partnership through to 2038.”
Flutter will finance the transaction though a senior secured first lien term loan comprising an aggregate principal of $1.75 billion. The facility matures 12-months after first utilisation, with two additional six-month extension options, and carries interest at a per annum rate equal to Term SOFR plus an applicable margin equal to 1.25 per cent.
The $1.755 billion consideration is comprised of approximately $1.55 billion attributable to the acquisition of Boyd’s 5 per cent stake in FanDuel and approximately $205 million attributable to the revision of various existing commercial terms.
Fox Corporation continues to hold an option to acquire an 18.6 per cent equity interest in FanDuel before December 3, 2030, with the value of that equity interest currently equating to an exercise price of $4.5 billion.
Shares in Boyd Gaming Corp. (NYSE:BYD) closed 1.50 per cent higher at $85.37 per share in New York Thursday, while shares in Flutter Entertainment plc. (NYSE:FLUT) closed 1.14 per cent higher at $289.58 per share.