Mon. Apr 19th, 2021

FOX Files Lawsuit To Get More Favorable Price On FanDuel

Flutter wants Fox to pay “fair market value” to exercise the option in July and CNBC notes that the price could be determined by a FanDuel initial public offering, which Flutter is considering.

Fox has filed a lawsuit against Flutter over a disputed 18.6% option in FanDuel, according to Alex Sherman of CNBC.

The network wants to buy into FanDuel at the same price that Flutter – the U.K.-based majority owner of FanDuel – paid for in December of 2020 when it acquired a 37.2 stake in FanDuel, as noted by Forbes.

Flutter wants Fox to pay “fair market value” to exercise the option in July and CNBC notes that the price could be determined by a FanDuel initial public offering, which Flutter is considering. 

Sherman goes on to report that, according to Flutter, if FanDuel isn’t spun out by July, the banks will determine the company’s fair value, which is likely to be higher than rival DraftKings‘ $25 billion market capitalization.

“Fox Corporation has filed suit against Flutter to enforce its rights to acquire an 18.6% ownership interest in FanDuel Group — an American sports betting brand — for the same price that Flutter paid for that interest in December 2020,” a Fox spokesperson said in a statement given to CNBC. “The suit was filed as an arbitration before JAMS in New York, NY by consent of the parties.”

CNBC also notes that “it is unclear if the Fox lawsuit will interrupt planning around the FanDuel IPO and, if an IPO proceeds, pending litigation could affect how investors value a publicly-traded company.”

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