Flutter to Put US Listing Plans to Shareholder Vote in April

Posted on: March 25, 2023, 04:11h. 

Last updated on: March 25, 2023, 04:11h.

Todd Shriber @etfgodfather Read More
Expertise: Financial, Gaming Business, Mergers and Acquisitions.

FanDuel parent Flutter Entertainment (OTC: PDYPY) said that following a consultation with investors regarding the possibility of a secondary listing for the stock in New York, the gaming company will put that matter to a shareholder vote in April.

FanDuel Flutter
Flutter CEO Peter Jackson. The company will put the matter of a US stock listing to investors next month. (Image: The Independent)

The gaming company announced in February that it would consult with stakeholders about the potential of a secondary listing of its equity on the Nasdaq or the New York Stock Exchange (NYSE). Flutter shares currently trade in the US, but on an over-the-counter basis and the primary listing is on the London Stock Exchange (LSE) where the Irish bookmaker is also a member of the FTSE 100 Index.

Having consulted widely with shareholders representing a significant majority of Flutter’s issued share capital and received very strong support, the Flutter Board is pleased to announce that a formal resolution will be put to shareholders on this proposal at the forthcoming all group meeting (AGM) on 27 April 2023,” according to a statement issued by the Dublin-based firm.

Flutter owns 95% of FanDuel — the largest online sportsbook operator in the US. The other 5% is held by Las Vegas-based Boyd Gaming (NYSE: BYD).

Next Steps in Flutter US Listing Process

Should a specified percentage of Flutter shareholders approve of the US listing, it could happen as soon as the fourth quarter. They must cast their votes on the proposed transaction either by proxy or in person at the April meeting.

“The resolution requires the approval of 75% of the votes cast by Flutter shareholders in person or by proxy. Should shareholders approve the resolution at the AGM, Flutter will aim to implement the additional US listing during Q4 2023,” added the gaming company in the statement.

Analysts are constructive about the prospects of Flutter listing the US with some believing that move will remove the conglomerate discount currently hampering the stock. Said another way, because Flutter trades in London and FanDuel is a US operator, the latter’s value to the former isn’t properly priced into the parent company’s shares. That could change with a New York listing.

On a related note, by listing in the US, Flutter could significantly broaden its base of both professional and retail investors and more efficiently raise capital via debt and equity sales, if needed.

Impact to FanDuel Spinoff

Flutter’s Friday statement on the US listing vote doesn’t mention FanDuel or the once frequently rumored topic of spinning off the US business to unlock value for investors. When Flutter originally announced plans to consult shareholders on the US listing scheme, it mentioned that transaction would take priority over a potential separation of FanDuel.

Should the company proceed with bringing its stock to New York, that may quell calls for spinning off FanDuel because the business may be more appropriately valued in the US and investors here might not want it jettisoned from the parent company.

Those investors may likely want Flutter to retain FanDuel because the latter has dominant share in the US online sports betting market and is cruising toward a full year of profitability in 2023.