MARKET REPORT: Murdoch in legal battle with Flutter over Fanduel stake

MARKET REPORT: Rupert Murdoch in legal battle with Flutter Entertainment over stake in US sports betting group Fanduel

Investors in Flutter Entertainment were on edge after the betting giant confirmed it was locked in a legal battle with Rupert Murdoch’s Fox.

The media behemoth has filed a claim against Flutter over a dispute about an investment in US sports betting group Fanduel.

The rapid legalisation of gambling in US states over the last few years has made it one of the most lucrative markets in the world – and British companies have rushed in.

Rupert Murdoch’s firm Fox helped Paddy Power owner Flutter increase its stake in Fanduel to 95 per cent. The deal valued Fanduel at £8.2bn. But the partnership has soured over the price

Fox helped Paddy Power and Betfair owner Flutter increase its stake in Fanduel to 95 per cent last year. 

The deal valued Fanduel at £8.2billion. The aid, through buying Flutter shares, also came with an option for Fox to buy an 18.6 per cent holding.

But the partnership has soured over the price, with Fox saying it should pay an equivalent amount that Flutter did.

Stock Watch – Fireangel Safety Technology 

Fireangel Safety Technology rocketed after it agreed an £18million deal to develop and supply a German company with smoke alarms.

The unnamed firm will provide research funding and Fireangel will then supply it with around 7m alarms. 

The devices will be able to connect via wifi, meaning multiple alarms can alert one another and go off simultaneously if smoke is detected.

They can also send warnings to a phone. Fireangel jumped 93.1 per cent, or 13.5p, to 28p.

Flutter denies this is the case and argues that it agreed Fox would pay a fair market value if it took the option up. 

The FTSE 100 betting group also said it would be a ‘windfall’ for Fox compared with Fanduel’s current price.

It is not clear what that price is, but online gambling groups have thrived during the pandemic as punters cooped up at home turned to betting on their laptops and mobiles.

Flutter has said it will ‘vigorously defend its position’ in the upcoming arbitration. Its shares dropped 2.5 per cent, or 4.55p, to 180.05p, which sent it to the bottom of the Footsie leaderboard.

But the wider market was on the up. The FTSE 100 gained 0.9 per cent, or 61.77 points, to close at 6885.32. 

But it was the FTSE 250 that stole the show. The index closed 0.8 per cent higher, up 166.09 points, to reach a record high of 22,160.57 – meaning it has now recouped all its losses since the markets went into turmoil in February last year, when the scale of Covid was only just being understood.

Anglo American edged 0.8 per cent, or 24.5p, up to 2998.5p after its famous diamond arm De Beers sold £320million in its third gemstone auction of the year.

Luxury spending had been waning even before the pandemic and lockdowns that have meant people are wearing jewellery less frequently – and are more cautious about how they spend their money – have hit the industry further.

Investors rushed to exit former stock market darling Hurricane Energy after an estimate of its oil and gas resources in the North Sea was so dire that it was forced to warn shareholders that there was ‘no certainty of any further activity’. It was thought there were 1.2bn barrels of oil in the assets west of Shetland but this has been all but wiped out.

It is looking to refinance but warned this could wipe out shareholders. Spooked shareholders sent the company’s stock 25 per cent lower, down 0.9p, to 2.7p.

Elsewhere on AIM, Joules made gains after it poached Moneysupermarket finance director Caroline York. The Market Harborough-based retailer said she will take up the same role at Joules by September. 

Joules rose 1.2 per cent, or 2.5p, to 216p, while Moneysupermarket shrugged off the loss, rising 2.8 per cent, or 7.6p, to 280p.

Argo Blockchain was in the spotlight again after it posted record revenues for cryptocurrency ‘mining’ for a third month.

In March it made £6.6million. The group uses computer algorithms to unlock, or ‘mine’, new bitcoins. Its shares have rocketed in line with a surge in the price of bitcoin, which was hovering around $56,000 last night.

Data from Interactive Investor and AJ Bell (up 0.5 per cent, or 2.4p, to 442.4p) showed Argo (down 2.8 per cent, or 6.5p, to 240p) was among the most-traded stocks on their platforms in March.