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DraftKings Inc. completed its previously proposed $750 million acquisition of Jackpocket, the US leading digital lottery application.
The acquisition gives DraftKings new opportunities to cross-sell Jackpocket lottery customers on its online casino, sports betting, daily fantasy sports and horse racing products.
Key takeaways
- DraftKings reached an agreement with Jackpocket in February. The company first revealed the proposed transaction during its Q4 2023 earnings.
- Also in February, Jackpocket Casino went live in New Jersey, the only state where it operates. The Jackpocket lottery app is available in New Jersey and 17 other jurisdictions.
- The acquisition will benefit both DraftKings and Jackpocket, giving the former a new customer acquisition channel.
This acquisition empowers DraftKings to enter the growing US lottery vertical
Subject to customary purchase price adjustments, DraftKings (NASDAQ: DKNG) announced it would acquire the leading US lottery app for nearly $750 million, with approximately:
- 55% of the consideration ($412.5 million) payable in cash
- 45% of the total amount ($337.5 million) payable in DraftKings stock to Jackpocket shareholders
The acquisition allows Boston-based DraftKings to enter the extensive US online lottery vertical while expanding its position in iGaming and sports betting by improving customer lifetime value and supporting customer acquisition capabilities. Jason Robins, CEO and co-founder of DraftKings, said in a press release:
“We are well-prepared to quickly launch cross-sell programs, further improve customer acquisition efficiency, and continue to innovate and differentiate with our overall product portfolio for our customers. We look forward to continuing to deliver enhanced value to our customers and shareholders as we integrate Jackpocket into the DraftKings ecosystem.”
With the acquisition now complete, DraftKings is focused on integrating Jackpocket into its operations. The company says it will continue to deliver an “exceptional experience” to its customers while advancing its mission of “responsibly providing safe, innovative, and engaging real-money gaming offerings.”
DraftKings has been among the most determined companies acquiring former online casino competitors, having also purchased Golden Nugget online casino.
Following the North Carolina sports betting launch, DraftKings Sportsbook is live in 25 states, with its online casino available in 5 states.
The beginning of a new chapter for Jackpocket
Jackpocket is known for innovative digital lottery services, solid technology infrastructure and strong brand presence. It has established a significant share of a competitive market. CEO of Jackpocket Peter Sullivan said:
“The completion of the acquisition represents an exciting new chapter for Jackpocket and DraftKings alike. Together, we are confident that we will be even more capable of helping lotteries fulfill their mission of delivering revenue back to the beneficiaries they support. DraftKings’ proven reach and cutting-edge mobile platforms will continue to allow us to drive growth and innovation in the digital lottery vertical.”
The Jackpocket online casino is only available in New Jersey, while the Jackpocket lottery app is available in 15 other states, Puerto Rico and Washington, DC.
The New Jersey online casino market is the largest in the US, with more than 30 iGaming brands.
Operating under Harrah’s, Jackpocket reported $1,584,574 in revenue in April, its second full month of operations in New Jersey. The figure represents a 64.4% increase from $969,726 set in March.
