The owner of Paddy Power, Flutter Entertainment, has reached a settlement for its legal dispute with the state of Kentucky.
The dispute has been going on for over a decade, and started with Kentucky accusing PokerStars of allowing its residents to gamble online between 2007 and 2011. PokerStars had earned around $18m in revenue from Kentucky during the period in question.
However, after having acquired PokerStars through a 2020 merger with the Stars Group, Flutter has agreed to pay a settlement of £146m ($200m), alongside $100m already forfeited as a bond. In response, Kentucky has agreed to stop pursuing the operator.
The settlement is much lower than the $1.3bn Flutter was first ordered to pay by the Kentucky Supreme Court in December 2020. Sources say Flutter “was shocked by the outcome” in December and went on to challenge the ruling in the Supreme Court (but it also worked on a remediated settlement alongside that process).
A spokesperson for Flutter commented: “The group strongly believes this agreement is in the best interests of Flutter shareholders. The group now considers the matter closed.”
Analysts at Davy Group (capital market and wealth management company) said of the settlement: “We view this as towards the lower (more favourable) end of potential outcomes. Importantly, it also removes a key stock headwind of recent months.”
Flutter is a sports betting and gaming operator that delivers worldwide betting and gaming experience; alongside Paddy Power, the company’s portfolio includes brands such as Betfair, FanDuel, Fox Bet and Sportsbet.