The merger between the two market leaders in the daily fantasy sports (DFS) sector was first proposed in November 2017.

For both companies, the merger made a great deal of sense. FanDuel and DraftKings were spending huge amounts of money on advertising and competing directly to dominate the market. At the same time, both companies were lobbying to have daily fantasy sports betting legalised throughout the United States, an ongoing problem which has seen several states announce that DFS breaches their gambling regulations, while others have introduced new fees and taxes for DFS operators.

However, in June 2017 the US Federal Trade Commission announced that it would go to court in an attempt to block the merger as the new company would control over 90% of the entire US market.

Both companies have now confirmed that the merger is off the table and both FanDuel and DraftKings will continue to operate independently.

Speaking to TechCrunch, FanDuel CEO Nigel Eccles, said: “FanDuel decided to merge with DraftKings last November, because we believed that this deal would have increased investment in growth and product development thereby benefiting consumers and the greater sports entertainment industry. While our opinion has not changed, we have determined that it is in the best interest of our shareholders, customers, employees, and partners to terminate the merger agreement and move forward as an independent company. There is still enormous, untapped market opportunity for FanDuel, and we will continue to execute our strategy to grow our business and further expand the fantasy sports industry. We’d like to thank our partners and customers for their patience, support and continued loyalty over the past several months.”

Jason Robins, the CEO of DraftKings, commented: “Over the past few years, DraftKings has become the world’s leading fantasy sports company. We are recognized as a global sports entertainment brand and the industry leader in utilizing technology to bring our customers the best fantasy contests and products. We have a growing customer base of nearly 8 million, our revenue is growing over 30% year-over-year, and we are only just beginning to take our product overseas to the billions of international sports fans we have yet to even reach.

“Consequently, we believe it is in the best interests of our customers, employees, and investors to terminate our agreement to merge with FanDuel and move forward as a separate company. This will allow us to singularly focus on our mission of providing the most innovative and engaging interactive sports experience imaginable, forever changing the way fans connect with teams and athletes worldwide. We appreciate the continued loyalty of our players – it is you, our customers who have made this all possible – and we look forward to kicking off what is going to be our best NFL season yet!”

Both companies will now have to find ways to manage the high costs of marketing in the run-up to the new NFL season, one of the busiest times of the year for the DFS sector and operate sustainably in a market which is throwing up new legal challenges and costs on an ongoing basis.