CMA opens probe into Flutter’s £10bn Stars Group betting merger
The UK’s competition watchdog is set to open an investigation into a planned £10bn gambling merger between Flutter and the Stars Group.
The Competition and Markets Authority (CMA) will probe whether the tie-up between Paddy power and Betfair owner Flutter and Toronto-based Stars will hurt competition.
The CMA is considering whether it is or may be the case that this transaction, if carried into effect, will result in the creation of a relevant merger situation under the merger provisions of the Enterprise Act 2002 and, if so, whether the creation of that situation may be expected to result in a substantial lessening of competition within any market or markets in the United Kingdom for goods or services.
Flutter’s shares were up 0.6 per cent despite the probe.
Morning Wire has approached the betting firm for comment.
Flutter’s stock surged 14 per cent after it announced the merger in October last year. If it goes ahead, the tie-up would create one of the world’s largest gambling firms.
The two companies are targeting £140m of cost synergies as a result of the deal. And they hope their combined strength will be enough to break into the US market, where sports betting laws have been relaxed.
Flutter’s Stars Group merger it due to complete in the second quarter of 2020.
A Flutter spokesperson said: “Today’s announcement is in line with our regulatory expectations and timelines. We will continue to work closely with the CMA to ensure it can make an informed decision.”