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It continues a trend of consolidation for the DFS industry after a period of wild growth, investment and new entrants that slowed by the latter part of 2015. DraftKings and FanDuel — the two largest companies in the space by a wide margin — agreed to a merger expected to wrap up later this year.
The details are sparse, at this point.
Visitors to the Fantasy Aces website — which no longer has active contests — are greeted with this message:
Fantasy Aces is pleased to announce that we have come to an agreement to be acquired by FantasyDraft.
We appreciate your patience as we work with the FantasyDraft team to ensure a smooth transition for our players.
We expect the process to be completed within 3 to 5 business days, and will provide more detail as it becomes available.
This morning, Aces offered a press release:
Fantasy Aces Daily Fantasy Sports Corp, (TSXV: FAS; OTCQB: FASDF) the, a Daily Fantasy Sport (DFS) enterprise with operations in Southern California, announces today that it has entered into an agreement with Fantasy Draft LLC (www.fantasydraft.com) to purchase certain assets of Fantasy Aces including the Fantasy Aces player base and their respective account balances. As the new home for Fantasy Aces players, FantasyDraft offers an elite platform, first class customer support and a full range of contest offerings consistent with those that Fantasy Aces has been noted for within the Daily Fantasy Sports industry.
Earlier this week, regulators announced a stop for trading of Fantasy Aces shares. Trading remains closed for shares of Aces, a publicly held company.
Soon after the news from Aces, FantasyDraft confirmed its end of things on its website.
FantasyDraft has agreed to acquire certain assets from Fantasy Aces, including their player base and corresponding balances. This transaction should take 3-5 business days to complete. We’ll be updating this page with more information as it becomes available.
Fantasy Aces users can get more information on the acquisition at the above link.
Fantasy Aces and FantasyDraft are two of the sites vying for the No. 3 position in the industry.
If neither Fantasy Aces or FantasyDraft had surpassed Yahoo in terms of liquidity previously, the new merged site almost certainly does. In November, Aces acquired the user base of another site, Fantasy Feud. So the new deal represents the consolidation of three of the largest DFS operators, behind DraftKings and FanDuel.
There is certainly some amount of overlap between the two sites’ databases, but the acquisition will represent an increase in users for FantasyDraft.
Legal uncertainty and new laws at the state level have altered the path forward for many DFS operators. DraftKings and FanDuel joined forces rather than continue to compete with one another. iTEAM Network and Mondogoal are among the sites to close down their consumer-facing products.
The number of operators that might be willing to pay licensing fees and taxes for access to a state under new regulations continues to shrink, as well.