DAILY fantasy sports business FanDuel has used its intellectual property assets to raise a fresh round of debt finance as it waits for its takeover by Paddy Power Betfair to complete.
The firm, which was founded in Edinburgh almost a decade ago, has put up one UK, two European and four US trademarks as security for a loan package that has been put together by administrative agent Omega Advisors. It is understood that Omega has syndicated the debt.
Read more: FanDuel bought by Paddy Power Betfair
In addition to marks bearing the name FanDuel and the business’s shield logo, the firm’s Sportsrich and Turbo trademarks form part of the deal.
Sportsrich is a term FanDuel uses in its US advertising campaigns while Turbo is a fantasy sports game based on live sports.
It is not known how much FanDuel has raised from the deal and the firm declined to comment on whether it forms part of the $76 million of net debt that Paddy Power Betfair has committed to paying off as part of its acquisition of the business.
In an announcement to the London Stock Exchange this week Paddy Power Betfair said it would contribute its own US assets as well as $158m in cash for FanDuel, whose main private equity backers will retain a 39 per cent shareholding in the firm that will be gradually sold down over the next five years.
Read more: FanDuel founders to become business angels when firm sells
It said the cash “will be used to pay down existing FanDuel debt and fund working capital”.
As the deal is not expected to complete until the third quarter of this year it is thought that FanDuel, which made a pre-tax loss of $44m on turnover of $124m in 2017, has taken on additional debt to fund its working capital needs in the interim period.
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 here