ONE of Scotland's fastest growing tech firms and a rival fantasy sports company is in talks about a merger, it is claimed.
Investors in FanDuel, founded in Edinburgh by entrepreneurs Nigel and Lesley Eccles and DraftKings which are privately held, have been pushing for a tie-up for some time, it is said.
The companies have been facing the same legal challenges over their fantasy gaming offerings which threaten their business across the U.S.
No final transaction has been agreed, and the deal may still fall apart, sources have claimed.
FanDuel, hich employs close to 500 people between Scotland and the US, and DraftKing have been fighting rulings in some states that their Fantasy Football-style operations were essentially illegal gambling.
FanDuel has become a big player in the US and among those at its World Fantasy Football Championships in December, were American football legends Dan Marino and Joe Montana.
The Hall of Fame quarterbacks acted as hosts for the championship in San Diego where 120 players were vying for the first-place prize of $3 million.
The US Congress last month launched a fact-finding mission into what was described as the loosely regulated world of fantasy sports games.
In March DraftKings and FanDuel gave up their legal battle with New York authorities saying they will stop accepting bets in the state.
It was the ninth state where DraftKings agreed not to accept paid entries. FanDuel has ended paid games in 10 states.
The New York attorney general had accused DraftKings and FanDuel of being illegal gambling operations and sued to stop them. The battle was closely watched for clues into whether DraftKings and FanDuel could convince authorities that daily fantasy sports is a game of skill, not a contest of chance.
New York Attorney General Eric Schneiderman who says the games were essentially illegal gambling began investigating daily fantasy sports earlier this year amid allegations that employees of the competing companies were using inside information to win games. The fight eventually began winding its way through the courts.
The New York state legislature is expected to announce new regulations for the games soon, which would allow the companies to take entries from New Yorkers again.
The sites operate in a similar manner to online fantasy league soccer sites in the UK, except they concentrate on popular American sports such as American football, basketball and ice hockey.
Points are gained for an individual 'fantasy' team based on the actual game performance of individual players.
In traditional fantasy leagues, the game takes place over an entire season, by contrast daily fantasy sports leagues track performances in single games on a weekly basis.
Individuals pay a fee to participate in a league, which funds a pot of money used to pay out to the participants.
Fantasy sports started in 1980 and surged in popularity online in the US.
Although it was founded in Edinburgh by Mr and Mrs Eccles, FanDuel only operates in America and Canada.
The pair still live in the Scottish capital, although the site's headquarters are in New York.
As of May 2014, the company employs a total 80 people, with offices in New York, Edinburgh, Glasgow, Orlando, and Los Angeles.
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules hereComments are closed on this article