With barely a week before the National Football League (NFL) kicks off, small daily fantasy sports (DFS) operators are consolidating its forces in order to give giants DraftKings and Fanduel a run for their money.
Small DFS operator Fantasy Aces announced on Wednesday that it has acquired certain active DFS participants in the database of Fantasy Feud Inc. (FFI), according to Yahoo! Finance.
Gaming Nation – parent company of FFI – will receive a cash payment of C$25,000 (US$19,076.25) in exchange for Aces’ direct access to its more than 35,000 participants in its database. The remainder of the purchase price, according to Fantasy Aces, will be paid in common shares of the company.
Data showed that Fantasy Aces and FFI have a combined gross revenue of US$1.15 million with game entries of 1.38 million and prize payouts of US$12.11 million.
The small DFS player pointed out that the completion of the acquisition of FFI is “subject to the approval of the TSX Venture Exchange and all other regulatory bodies having jurisdiction in connection with the Acquisition.”
Once the deal is finalized, Fantasy Aces said that they will announce the full tag price of the acquisition.
“Upon completion of the Acquisition and the migration of the FFI participants to the Fantasy Aces platform, Fantasy Aces will become one of the largest daily fantasy sports (“DFS”) companies in the industry. Fantasy Aces executives and employees will continue to serve as the operators, including all day-to-day site operations,” Fantasy Aces said in a statement.
The firm also pointed out that it “will become the DFS site recommended and endorsed by the other key daily fantasy properties controlled by Gaming Nation including Fantasy Guru, DFS Guru Elite, Pick Nation and 5050 Central.”
Analysts say that Fantasy Aces now ranks fourth in the order of DFS operators, together with FantasyDraft. The top three DFS operators in the market are DraftKings, FanDuel, and Yahoo DFS.
Rumors, however, persist that more DFS operators will merge in the months to come. Since the start of summer, there have been rumors of a possible merger between DraftKings and FanDuel.
Pundits are, on the other hand, expecting second-tier operators DraftPot and DraftOps to take the same path that Fantasy Aces and FFI have taken.
According to Fantasy Aces, acquiring and consolidating players in the industry will “become the other choice for fantasy players after DraftKings and FanDuel.”
“This deal should prove to be extremely accretive to shareholders. Not only does it provide us with all the positive points listed above, but the timing of the deal could not be better as we move in to the biggest quarter of the year, with NFL starting, followed by NBA and NHL, while MLB and PGA continue,” Tom Frisna, Chief Executive Officer of Fantasy Aces, said in a statement. “With certain states finally announcing that DFS players are able to freely play, we expect the whole industry to expand dramatically over the next few years. As a result of this transaction we could not be more excited to grab a bigger piece of what is becoming one of the biggest new industries in North America.”