Can Flutter Entertainment plc be considering swapping the London Stock Exchange as its primary listing in favor of Wall Street? Well, if the rumors are true, then this might become a reality as early as May of this year. The surprising news came just after Flutter debuted on the New York Stock Exchange for its secondary listing while simultaneously delisting from Euronext Dublin.
Owner of several well-known gambling brands, Flutter Entertainment plc has certainly made a name for itself, building a solid reputation over the years. Many Irish and UK punters and casino players are possibly more familiar with Paddy Power and Betfair - incidentally, one can find a very interesting and comprehensive review by NoDepositCasino.guide about the latter. As for the US-based gambling enthusiasts, there is also the renowned FanDuel.
Company Background
Flutter's roots can be traced back to April 1958 when Corcoran’s Management Limited was registered in Ireland. Over the course of several decades, the company underwent transformations. In 1988, it adopted the name Paddy Power following the merger of three independent bookmaker businesses. Paddy Power made its public debut in 2000, cementing its presence in the gambling industry by establishing numerous betting shops across Ireland and the UK.
In 2016, Paddy Power plc merged with Betfair Group plc to form Paddy Power Betfair plc. Two years later, the company completed a merger with US bookmaker FanDuel. In 2019, the company officially rebranded as Flutter Entertainment plc and listed under this name on the London Stock Exchange.
US Bound
In a press release issued on Monday to mark the launch of Flutter Entertainment plc on the New York Stock Exchange, the Board reiterated the primary reasons for expanding the company's presence in the US. Key factors highlighted include the potential for enhanced liquidity, access to deeper capital markets, and the opportunity to explore relocating the primary listing to the US.
Peter Jackson, Chief Executive Officer of Flutter Entertainment plc, described the debut on Wall Street as a "pivotal moment for the Group." Jackson emphasized that the US market will become Flutter's "natural home," citing FanDuel's status as a leading player in the US gambling industry and the Board's anticipation of the company's US operations becoming its most profitable business segment.
In an interview with the investing publication Barron's, Jackson expressed enthusiasm about the prospect of listing on Wall Street, particularly due to FanDuel's significant contribution to Flutter's current business operations. He reiterated that New York is "the right place" for the company to be located.
Continuous Growth
Earlier this month, Flutter issued a trading update for the fiscal year 2023, underscoring its sustained expansion in the US market. Over the 12 months ending on December 31, group revenue soared by 25% to £9.51 billion for Flutter's 2023 financial year. This remarkable growth was largely driven by a significant 38% surge in revenue from its US operations, which reached £3.06 billion. This uptick coincided with the US Supreme Court's decision to overturn a long-standing law prohibiting sports betting across various parts of the country.
The US segment emerged as the primary revenue generator, accounting for 37.9% of the total revenue. On a constant currency basis, revenue from US sports saw a significant 39% increase, while gaming revenue rose by 47%. Additionally, Flutter highlighted a noteworthy 38% rise in the average monthly player count, surpassing 3.2 million.
Flutter CEO Peter Jackson emphasized the company’s three-year strategy to assert dominance in the American market, with FanDuel poised to lead the charge and achieve significant milestones in the strategy's final year.
Going A Step Further
If the proposed move to Wall Street is approved by shareholders and takes effect in 2024, it will not signify a complete departure from the London Stock Exchange. As Flutter continues to own major Irish and UK brands such as Paddy Power, Betfair, and Sky Betting and Gaming, its listing in London will remain but transition to a secondary status.
According to Flutter, this decision will enable a larger number of investors to retain ownership of its shares and capitalize on future value growth. Following Flutter's announcement of its US listing, shares on the LSE experienced fluctuations today. Initially, the price of LSE-listed shares dropped nearly 2.00%, and at the time of writing, they are currently trading 0.89% below today's opening price.