draftkings-surges-after-announcing-espn-deal

DraftKings surges after announcing ESPN deal

The entrance from the elevators, designed to resemble a tunnel entering a stadium, is pictured at the new DraftKings office in Boston on March 25, 2019.

David L. Ryan | The Boston Globe via Getty Images

Shares of DraftKings rose sharply on Monday after the sports gaming company announced an agreement with sports entertainment giant ESPN. 

As part of the agreement, DraftKings will be the exclusive provider of daily fantasy sports and a co-exclusive partner for gambling link-outs from ESPN, the company said. DraftKings content will be integrated into ESPN’s digital offerings and studio shows, according to the announcement.

DraftKings’ stock jumped more than 17% following the announcement. The shares were slightly negative for the session around midday before the news. Financial terms of the deal were not disclosed. 

“We look forward to this collaboration to exclusively showcase DraftKings’ daily fantasy content and offerings while also advancing further visibility and mainstream adoption of our regulated sports betting products,” DraftKings CEO Jason Robins said in a release. 

Shares of DraftKings have now surged more than 170% since going public through a merger in April. The gain has come despite major U.S. sporting events being postponed during the height of the coronavirus pandemic restrictions. 

The last big move in the stock came earlier this month when the company named Michael Jordan as a special advisor to the board of directors.

Disney-owned ESPN holds broadcast rights to most of the major U.S. sports, including the NBA and the NFL’s Monday Night Football. U.S. sportsbooks were gearing up for high betting demand last weekend, which saw the return of the NFL and playoff games for the NBA and NHL. 

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