Paddy Power, Betfair to merge

26 August 2015

By Dan Podheiser

Another massive online gambling partnership hit the books Wednesday morning, as sportsbook giants Betfair and Paddy Power reportedly agreed to merge in a £5 billion deal.

Final details of the merger are still being worked out, but Paddy Power shareholders will retain 52% of the combined business, while Betfair investors will own the remaining 48%, according to BBC News. Current Betfair chief executive Breon Corcoran, who formerly served as COO of Paddy Power, will become the CEO of the new firm.

"We fundamentally believe this industry is all about scale. By putting together two distinct but phenomenally strong brands, we'll have a market-leading position in the U.K., Ireland, Australia and in the United States," Corcoran told BBC News.

Paddy Power and Betfair ranked fifth and sixth in the world among interactive gambling companies in 2014 with gross gaming yields (GGY) of £438.6 million and £393.6 million, respectively. bet365 ranked first in GGY in 2014 at £1.28 billion.

The merger is the latest in a recent trend of consolidation of some of the biggest players in the online gambling industry.

In June 2014, Montreal-based Amaya Gaming purchased online poker power PokerStars and sister site Full Tilt Poker for a whopping $4.9 billion. This summer, bwin.party has been in the middle of a tug-of-war battle between 888 Holdings and GVC Holdings, who have each made offers for bwin.party in excess of $1.4 billion.

Meanwhile, sportsbook-focused operators Ladbrokes and Coral are in the midst of a merger that will make the new firm one of the largest operators of brick-and-mortar betting shops in the U.K.

Dan Podheiser

Dan Podheiser has covered the gambling industry since 2013, but he has been an avid poker player for more than a decade, starting when he was just 14 years old. When he turned 18, he played online poker regularly on U.S.-friendly sites until Black Friday in April 2011.

Since graduating from Emerson College with a degree in journalism in 2010, Dan has worked as the sports editor for a chain of newspapers in Northwest Connecticut and served a year as an Americorps*VISTA, writing and researching grant proposals for a Boston-based charity.

Originally from South Jersey, where he still visits occasionally to see his family (and play on the state's regulated online poker sites), Dan lives in Brighton, Mass. with his wife and dog.