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DraftKings announced it has reached an agreement to acquire Jackpocket.
Boston-based DraftKings will acquire the leading US lottery application for nearly $750 million, with approximately 55% of the consideration ($412.5 million) payable in cash. Jackpocket shareholders will receive the remaining 45% of the total amount ($337.5 million) in DraftKings stock, subject to customary purchase price adjustments.
DraftKings announced the Jackpocket deal during its Q4 2024 earnings call
When releasing fourth-quarter earnings, DraftKings revealed an agreement to buy Jackpocket.
For the quarter ending in December 2023, DraftKings said its revenue reached $1.23 billion, slightly below the consensus estimates of $1.24 billion. The revenue figure is still an annual increase of $376 million, or a 44% year-over-year progress, compared to $855 million set during the last quarter of 2022.
The company said that its successful Q4 2023 revenue was influenced mainly by:
- Constant healthy customer engagement
- Efficient acquisition of new customers
- The expansion of the company’s sportsbook product into new jurisdictions
- Product innovation, which led to an increased parlay mix and higher structural sportsbook hold percentage
DraftKings is on its way to take over the gambling industry
The proposed transaction will empower DraftKings to access and grow into the massive US lottery industry. DraftKings has become one of the most successful US operators and plans to strengthen its position in sports betting and the US online casino vertical.
As the press release further states, the Boston-based online gambling giant aims to flourish by increasing customer lifetime value and improving customer acquisition. Jason Robins, Co-founder and CEO of DraftKings, said in a news release:
“We are very excited to enter the rapidly growing US digital lottery vertical with our acquisition of Jackpocket. This transaction will create significant value for DraftKings not only by giving our customers another differentiated product to enjoy but also by improving our overall marketing efficiency, similar to how our daily fantasy sports database created an advantage for DraftKings in OSB and iGaming.”
Jackpocket online casino recently went live in New Jersey
Jackpocket Casino went live in New Jersey earlier this month through a partnership with Caesars Interactive Gaming, with CIG’s other brands in NJ including Caesars Online Casino and Tropicana Online Casino. The lottery platform previously announced a soft launch in November.
Jackpocket debuted in 2019 as a primary registered US online lottery product. Currently, the lottery is available in 18 US jurisdictions, including the most significant markets like:
- New York
- Ohio
- Texas
- New Jersey
Speaking of the acquisition, Peter Sullivan, CEO of Jackpocket, said:
“Together with DraftKings, we will be able to bring tremendous value to our customer base as we advance our mission to create a more convenient, fun, and responsible way to take part in the lottery.
DraftKings’ broad footprint and exceptional mobile products present an opportunity to meaningfully expand the digital lottery vertical, and we could not be more excited to come together with DraftKings.”
