Online fantasy-sports companies DraftKings and FanDuel, which agreed to pull out of New York earlier this year following a crackdown by authorities, are in talks to merge with one another.
Investors in the two privately held companies, which compete head-to-head with each other, have been pushing for the two firms to merge for some time, according to Bloomberg News.
The two were each valued at more than $1 billion a year ago, but those valuations have dropped about 50 percent since regulators have started cracking down on virtual fantasy sports, which critics say amount to illegal online gambling.
In fact, the two agreed to stop New York residents from using their products in March after Attorney General Eric Schneiderman launched a high-profile campaign against the industry.
The Boston-based DraftKings has previously decided to sublease its 23,500-square-foot space at Alvin Flaster’s 400 Lafayette Street in Noho, but said its decision had nothing to do with regulators.
The state legislature is planning to lay forward a plan soon that would allow state residents to participate in online fantasy sports once again, according to Bloomberg. [Bloomberg] – Rich Bockmann