Paddy Power-Betfair confirmed the talks two days after the U.S. Supreme Court struck down a 1992 federal law prohibiting states from authorizing sports wagering.
The UK operator said discussions with Fanduel, which hands cash prizes to players who pick successful fantasy sports teams, were ongoing and that there was no certainty any deal would go ahead. New Jersey is among the states expected to enact legislation within weeks.
The Dublin-based group also runs the leading horse racing television and betting network in the U.S. and has an online casino business in New Jersey. The firm, which targets the estimated 30 million fans of fantasy sports spread across North America, purportedly abandoned a proposed merger with Boston-headquartered rival DraftKings Incorporated past year following a competition ruling from the Federal Trade Commission. Deutsche Bank restated a "buy" rating on shares of Paddy Power Betfair in a research report on Friday, March 9th.
Paddy Power Betfair is reportedly closing in on a deal to acquire daily fantasy sports (DFS) operator FanDuel.
Analysts at Davy Stockbrokers said the deal would hand Paddy Power Betfair an extremely well recognised USA brand, an award-winning technology platform that can be converted to offer real money betting and a database of over 6 million US customers.
Paddy Power Betfair has already invested $48m in there USA operations including the acquisition of another fantasy sports site, Draft. The deal would "create a combined business to target the prospective USA sports betting market".
Fantasy sports websites have been able to operate because they are considered to be games of skill rather than chance.