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DraftKings ‘in advanced talks’ to sell to Diamond Eagle Acquisition

US daily fantasy sports (DFS) operator DraftKings is in advanced talks over a sale to special-purpose acquisition company Diamond Eagle Acquisition, according to Bloomberg.

The news agency, citing people familiar with the matter, said Diamond Eagle is in exclusive negotiations with DraftKings, adding that a deal has yet to be signed and could yet fall through.

Diamond Eagle is led by Jeff Sagansky, formerly an executive with Japanese conglomerate Sony Corporation and US network CBS. It raised $400m (€358.2m) through an initial public offering (IPO) back in May.

Bloomberg notes that merging with a special-purpose acquisition company such as Diamond Eagle allows a private company to go public without an IPO. It added that Boston-headquartered DraftKings may also consider raising capital in another funding round if a deal isn’t agreed.

“DraftKings speaks to a variety of companies regarding various matters in the normal course of business, and it is our general policy not to comment on the specifics of any of those discussions,” the company said in a statement.

DraftKings became the National Football League’s (NFL’s) first official DFS partner last month and had been involved in a high-profile merger plan with rival FanDuel back in 2016. In July 2017, DraftKings and FanDuel scrapped this plan following opposition from the US government.

In May 2018, gambling operator Paddy Power Betfair signed a definitive agreement with FanDuel that led to the two companies merging their US businesses.