{"id":135212,"date":"2020-05-08T09:21:47","date_gmt":"2020-05-08T16:21:47","guid":{"rendered":"https:\/\/www.casino.org\/news\/?p=135212"},"modified":"2020-05-08T10:48:18","modified_gmt":"2020-05-08T17:48:18","slug":"flutter-scores-junk-rating-with-stable-outlook-in-first-post-merger-grade","status":"publish","type":"post","link":"https:\/\/www.casino.org\/news\/flutter-scores-junk-rating-with-stable-outlook-in-first-post-merger-grade\/","title":{"rendered":"Flutter Entertainment Earns Junk Mark From Moody’s in First Post-Merger Rating"},"content":{"rendered":"

Moody’s Investors Service assigned a Ba1 credit rating with a \u201cstable\u201d outlook to Flutter Entertainment, the research firm’s first grade on the company following its $12.2 billion merger with The Stars Group (TSG).<\/p>\n

\"Flutter
Staffers at the book. FanDuel parent Flutter could realize big cash flow and cost savings from its Stars Group merger. (Image: Yahoo Finance)<\/figcaption><\/figure>\n

That deal, which was wrapped up earlier this week, creates the world’s largest online gaming company \u2013 one that’s expected to generate revenue north of $4 billion<\/a>, with customers in more than 100 countries. Debt carrying one of the three Ba ratings from Moody’s \u201care judged to have speculative elements and are subjective to substantial credit risk.\u201d Those grades are non-investment grade, or junk.<\/p>\n

Flutter’s Ba1 corporate family rating (CFR) is supported by: (i) its leading position in the global online gaming market with podium positions in the largest online regulated markets; (ii) its focus on the online segment, which is the main growing segment in the gaming industry and (iii) its diversified product offering within the gaming market, supported by leading brands,\u201d said Moody’s in a note.<\/p><\/blockquote>\n

Flutter investors own 54.64 percent of the new entity, which started trading in Dublin and London on Tuesday, while Stars shareholders control the remainder.<\/p>\n

Creating a Behemoth<\/h2>\n

Flutter controls brands such as PaddyPower, Betfair, Adjarbet, FanDuel, TGV, and Sportsbet, making it a dominant player in the competitive European and US sports wagering markets. With TSG in the fold, the company adds PokerStars, Sky Betting and Gaming (SBG), and FoxBet, a combination that gives the firm dominant positioning in the UK<\/a> and increased exposure to the fast-growing US market.<\/p>\n

\n

Moody’s sees the new Flutter as well-positioned relative to its peers to capture growth in the US, citing \u201cthe complementary nature and diversification of the two businesses, it will also generate cost synergies as well as potentially sizable revenues and capex synergies.\u201d<\/p>\n<\/div>\n

The research firm is also bullish on Flutter’s strong cash flow generation and the company’s commitment to deleveraging its balance sheet \u2013 two traits investors are clamoring for at a time when sportsbook operators are under siege<\/a> because of cancellations and postponements of athletic competitions at the hands of the coronavirus.<\/p>\n

Stable View<\/h2>\n

The \u201cstable\u201d outlook assigned to Flutter assumes the company will at least grow at par with the markets it operates in, and that it proves successful in paring debt.<\/p>\n

\u201cThe stable outlook reflects our view that the company will continue to grow at least in line with the online market, and any regulatory pressure will be largely offset by the synergies achieved,\u201d said the credit agency. \u201cWe expect that Flutter’s leverage, as measured by Moody’s adjusted debt\/earnings before interest, taxes, depreciation and amortization (EBITDA) on a combined basis, will improve to below 3.5x and decrease towards 3.0x in the next 12-18 months, depending on the company’s commitment to repay debt with internally-generated cash flows.\u201d<\/p>\n

The ratings house said the outlook could be revised lower if Flutter’s leverage increases, or if the company pursues another big acquisition paid for in debt.<\/p>\n

At the end of last year, the company had almost $531 million in cash on hand<\/strong>.<\/p>\n","protected":false},"excerpt":{"rendered":"

Moody’s Investors Service assigned a Ba1 credit rating with a \u201cstable\u201d outlook to Flutter Entertainment, the research firm’s first grade on the company following its $12.2 billion merger with The Stars Group (TSG). That deal, which was wrapped up earlier this week, creates the world’s largest online gaming company \u2013 one that’s expected to generate […]<\/p>\n","protected":false},"author":46,"featured_media":135214,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[10,32093],"tags":[],"acf":[],"yoast_head":"\nFlutter Scores Junk Rating With Stable Outlook in First Post-Merger Grade<\/title>\n<meta name=\"description\" content=\"Flutter Entertainment lands a junk credit rating and a stable outlook from Moody's in its first grade following the Stars Group acquisition.\" \/>\n<meta name=\"robots\" content=\"noindex, follow\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Flutter Scores Junk Rating With Stable Outlook in First Post-Merger Grade\" \/>\n<meta property=\"og:description\" content=\"Flutter Entertainment lands a junk credit rating and a stable outlook from Moody's in its first grade following the Stars Group acquisition.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.casino.org\/news\/flutter-scores-junk-rating-with-stable-outlook-in-first-post-merger-grade\/\" \/>\n<meta property=\"og:site_name\" content=\"Casino.org\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/Casino.OrgNews\" \/>\n<meta property=\"article:published_time\" content=\"2020-05-08T16:21:47+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2020-05-08T17:48:18+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2020\/05\/fd-scaled.jpeg\" \/>\n\t<meta property=\"og:image:width\" content=\"3648\" \/>\n\t<meta property=\"og:image:height\" content=\"2736\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Todd Shriber\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@etfgodfather\" \/>\n<meta name=\"twitter:site\" content=\"@Casino_Org\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Todd Shriber\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.casino.org\/news\/flutter-scores-junk-rating-with-stable-outlook-in-first-post-merger-grade\/\",\"url\":\"https:\/\/www.casino.org\/news\/flutter-scores-junk-rating-with-stable-outlook-in-first-post-merger-grade\/\",\"name\":\"Flutter Scores Junk Rating With Stable Outlook in First Post-Merger Grade\",\"isPartOf\":{\"@id\":\"https:\/\/www.casino.org\/news\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.casino.org\/news\/flutter-scores-junk-rating-with-stable-outlook-in-first-post-merger-grade\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.casino.org\/news\/flutter-scores-junk-rating-with-stable-outlook-in-first-post-merger-grade\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2020\/05\/fd-scaled.jpeg\",\"datePublished\":\"2020-05-08T16:21:47+00:00\",\"dateModified\":\"2020-05-08T17:48:18+00:00\",\"author\":{\"@id\":\"https:\/\/www.casino.org\/news\/#\/schema\/person\/f4cecf70a5032bc4e60eb73fc86d4a85\"},\"description\":\"Flutter Entertainment lands a junk credit rating and a stable outlook from Moody's in its first grade following the Stars Group acquisition.\",\"breadcrumb\":{\"@id\":\"https:\/\/www.casino.org\/news\/flutter-scores-junk-rating-with-stable-outlook-in-first-post-merger-grade\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.casino.org\/news\/flutter-scores-junk-rating-with-stable-outlook-in-first-post-merger-grade\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.casino.org\/news\/flutter-scores-junk-rating-with-stable-outlook-in-first-post-merger-grade\/#primaryimage\",\"url\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2020\/05\/fd-scaled.jpeg\",\"contentUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2020\/05\/fd-scaled.jpeg\",\"width\":3648,\"height\":2736,\"caption\":\"FanDuel parent Flutter could realize big cash flow and cost savings from its Stars Group merger. 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