Big decision
Flutter Entertainment, the parent company of PokerStars, FanDuel, and Betfair, among many other brands, began trading on the New York Stock Exchange (NYSE) on Monday. As of the writing of this article, shares in FLUT are at $207.00, up 0.98% on the day.
Flutter doesn’t plan on stopping there, though. Currently listed on the London Stock Exchange (LSE), as well, it will change its primary share listing from LSE to NYSE “as soon as practicable.” Shareholders will be asked to weigh in on the move in May; if the company’s primary listing does move, Flutter will drop out of the FTSE 100.
The other consequence of moving its primary listing to NYSE is, as Flutter put it in a press release on Monday, “Giving optionality to pursue a primary listing in the US – one of the criteria for access to important US indices.”
And if you can get your company in major indices, you can get your shares scooped up by institutional investors, pushing your stock price higher (at least in the short term – some studies have concluded that in the long-term, those initial price boosts disappear).
The company had planned a secondary listing in Dublin, where it is headquartered, but that will no longer happen because of the NYSE listing.
Sports betting steering the ship
The catalyst for the financial move to the US (the company is not going anywhere physically) is the rapid growth of sports betting in the United States. Since the US Supreme Court overturned PASPA in 2018, over 70% of states of legalized sports betting and nearly half the US population has access to sports wagering in their home states.
The two largest states in terms of population – California and Texas – are the two most notable holdouts. The only other state in the top ten without sports betting is Georgia. That’s around a quarter of the country’s population, so there is still growth to be had in the industry.
With the growth in sports betting has come the growth in US revenues for Flutter and FanDuel, its industry-leading sports betting and daily fantasy business. The Guardian described the surge: “Five years ago, the group (then known as Paddy Power Betfair) relied on the US for about 10% of its business; by last year, the market was responsible for almost 40% of its sales.”
“With our NYSE listing effective today, this is a pivotal moment for the Group as we make Flutter more accessible to US based investors and gain access to deeper capital markets,” said Flutter CEO Peter Jackson. “We believe a US primary listing is the natural home for Flutter given Fanduel’s #1 position in the US, a market which we expect to contribute the largest proportion of profits in the near future.”
