While questions linger over the 2020 sports season, that hasn’t stopped DraftKings from upping its previously announced initial public offering (IPO) to 40 million shares of stock.
The Boston-based online sports gambling company announced Friday (June 19) it will sell 16 million shares of its stock. In addition, the company said some DraftKings stockholders will sell 24 million shares at $40 per share, bringing the total offering to $1.6 billion.
In April, PYMNTS reported DraftKings planned to go public through a reverse merger, under terms of a deal made last year with gambling technology provider SBTech and the publicly-traded sports acquisition company Diamond Eagle Acquisition Corp., which changed its name to DraftKings Inc. as part of the deal.
At the closing, Jason Robins co-founder and CEO of DraftKings, said the Diamond Eagle deal was another milestone for the DraftKings and the future of digital sports entertainment in the U.S.
“By bringing together our leading consumer brand, data science expertise and industry-leading products with SBTech’s proven technology platform, we will accelerate our innovation, growth and scale,” he said. “I am confident that the new DraftKings will progress our goal of offering the best, most innovative sports and gaming products to our customers.”
For the first three months of 2020, DraftKings, which has 800 employees in Massachusetts, posted a net loss of $68.7 million in the first quarter, Boston Business Journal reported.
In an interview with the publication, Robins was asked how long his company can stay in business without live sports.
“We have a ton of money on the balance sheet,” he said. “We also have a ton of alternative offerings that have started to pick up, and sports are coming back. We have golf coming back this week ... the NBA announced a plan to return, NFL said they're going to start on time. So it seems like that's kind of where things are headed. But if for some reason there were to be a complete change of course, and everything were shut down again, we could go a long time, several years, before we would run out of money.”