A major upheaval in the UK and global gambling markets moved a step closer on Monday with the news that Australian regulators have approved the merger of two of the sector’s biggest firms.
According to Flutter Entertainment, which owns the Betfair, Paddy Power and Draft Kings brands, the Australian Competition and Consumer Commission have given informal approval to its proposed merger with the Stars Group, which was first announced last year.
If the deal gets the formal seal of approval by regulators, it would create the biggest online retail gaming and retail operator in the global economy.
The deal is still to be approved by another Australian regulatory body, the Australian Foreign Investment Review Board. It will also be reviewed by a number of other regulators, both in Europe and around the world, which could yet block or delay the merger.
Flutter, which is based in Ireland, first announced that it intended to merge with the Stars Group, based in Toronto last October. If the merger goes ahead, the combined business would be worth £3.8 billion. It would also see the creation of a customer base of around ten million. Currently, Flutter customers are estimated to be six million, while Stars has four million players.
But there are still a number of hurdles to be cleared before the merger can go ahead. Earlier this month, the leading financial regulator in the UK, the Competition and Markets Authority, announced that it would be investigating the merger proposal and would not give its approval until the review was complete. They said that they would be examining whether the deal would result in the reduction of competition in any UK market.
Other regulators are also likely to weigh in on the deal, including the London Stock Exchange, Dublin’s Euronext and the Financial Conduct Authority. But if regulatory approval is forthcoming, Flutter and Stars have already said they hope to conclude the merger in the first half of 2020.