Operators Paddy Power and Betfair have agreed the terms of a recommended all-share merger to create Paddy Power Betfair, which had previously been agreed in principle.
Following the previous announcement of the plans in August, it has been confirmed that Paddy Power shareholders will own 52% of the merged entity, with Betfair shareholders owning 48%.
The merger is expected to be completed in the first quarter of 2016 and it was confirmed by Betfair CFO Alex Gersh at an investor and analyst presentation that it expects the combination “to be accounted for as an acquisition”.
Paddy Power shareholders will receive a special dividend of €80m immediately prior to completion of the merger.
Betfair shareholders will receive 0.4254 new Paddy Power Betfair shares in exchange for each Betfair share.
It is predicted by the boards of both companies that the combined group will achieve recurring annual pre-tax cost synergies of approximately £50m.
Paddy Power Betfair will be headquartered in Dublin.
As previously announced, Betfair CEO Breon Corcoran, a former COO of Paddy Power, will be CEO of the combined group, while Paddy Power CEO Andy McCue will be COO, Paddy Power chairman Gary McGann will be chairman and Gersh will be CFO.