DraftKings reportedly in talks to be acquired by Diamond Eagle

Diamond Eagle Acquisition Corp., a special-purpose acquisition company (SPAC), is in advanced talks to buy fantasy sports provider DraftKings Inc., Bloomberg reported on Wednesday.

The SPAC is in exclusive negotiations with the Boston-based DraftKings and no transaction has been finalized, that news agency reported, citing sources familiar with the matter, who asked to not be identified because the matter isn’t public. DraftKings may also consider raising capital in another funding round if it doesn’t consummate a sale, one of these sources said.

“DraftKings speaks to a variety of companies regarding various matters in the normal course of business, and it is our general policy not to comment on the specifics of any of those discussions,” the company said in an emailed statement.

Diamond Eagle’s shares rose as much as 2.7% to $10.15 in New York trading Thursday.

DraftKings and chief rival FanDuel sought to merge in 2016. They ended the deal in 2017 after opposition from the Federal Trade Commission. Irish bookmaker Paddy Power Betfair Plc agreed to acquire FanDuel last year. 

SPACs raise money from public investors to pursue an acquisition they haven’t identified yet. Merging with one enables a private company to go public without an initial public offering.

Diamond Eagle is the fifth SPAC set up by Hollywood executive and producer Jeff Sagansky. The former Sony Corp. and CBS executive’s previous SPAC, Platinum Eagle Acquisition Corp., agreed to buy two lodging companies last year. Diamond Eagle raised $400 million in an initial public offering in May.