One of the biggest moves in the global betting industry has been given the green light by regulators in the UK, providing a boost to two major operators during the COVID-19 shut down.
Flutter Entertainment’s proposed merger with the Stars Group was announced last year but was immediately subject to regulatory approval in multiple countries.
The two companies are considered two of the most high-profile betting groups in the UK, representing a combined revenue of around £1.5 billion. Flutter is the owner of Paddy Power and Betfair, while the Stars owns another well-known UK brand, Sky Bet.
But the size of the proposed merger inevitably drew the attention of the regulator and the Competition and Markets Authority (CMA) last year announced that they would be looking into the deal. Their investigation centred on whether customers who bet online could be offered a less competitive product, in the form of less favourable prices and promotions or poorer products, as a result of the merger. But according to the CMA, their investigation found that there was strong competition in the online betting sector, with a number of sportsbook operators competing for customers.
In the opinion of the CMA, there were many options for customers to switch to other companies, including high profile operators such as Coral, William Hill and Bet365. The CMA therefore concluded that although the two groups planning to merge were previously strong competitors, the merger will not worsen the overall betting product available to UK customers who bet online.
Both Flutter and the Stars Group have been hit hard by the shutdown associated with the virus pandemic, with retail premises closed and most sports events cancelled. But following the approval of the Australian regulator to okay the deal, the CMA’s verdict will be good news for both groups.