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Rush Street Interactive to Go Public via dMY Technology Group Merger

  • Special acquisition company dMY Technology Group is acquiring Rush Street Interactive (RSI)
  • RSI will be the name of the combined company, publicly-traded on the NYSE as RSI
  • Newly combined company will have an initial value of about $1.78bn and hold $235m in cash
Andrew O’Malley

Wall Street sign near NYSE
Rush Street Interactive is going public via an acquisition by dMY Technology Group. [Image: Shutterstock.com]

A big move

Rush Street Interactive (RSI) is set to go public via a merger with dMY Technology Group Inc., a special purpose acquisition company (SPAC).

Per the agreement announced on July 27, RSI will become a publicly-traded company on the New York Stock Exchange (NYSE) under the ticker symbol RSI. The combined company will change its name to Rush Street Interactive. It is hoped that this deal will close before the end of 2020.

initial valuation of around $1.78bn

RSI is one of the market leaders in the US online casino and sports betting space with its SugarHouse and BetRivers brands. The newly combined company has an initial valuation of around $1.78bn, with more than $235m in net cash available to fund its growth strategy. ?

Similar management structure

Once the transaction closes, RSI co-founder Neil Bluhm will remain as chairman of the board of directors, and RSI CEO Greg Carlin will keep his same role. Richard Schwartz, RSI’s other co-founder, will still be the company’s president. These three individuals will also retain approximately 93% of their existing equity holdings and will remain as the majority shareholders.

The chairman of dMY, Harry You, and the company’s CEO, Niccolo de Masi, will be part of the new company’s board of directors. Harry You was previously the chief financial officer of Oracle and Accenture. Masi has experience in the gaming industry as the chairman and former CEO of mobile games developer and publisher Glu Mobile.?

Because a SPAC is involved, RSI does not need an initial public offering (IPO). dMY is a “blank-check” corporation, specifically created to acquire another company, thus allowing the target to be listed on a stock exchange. This is achievable because dMY is already a listed company, despite not offering any product or service.

Another igaming company going public

The boards of directors of both RSI and dMY have already unanimously approved the deal. dMY stockholders must also have to give their approval and other standard closing conditions such as regulatory approval must be met before the deal can fully close, but there is no indication that there will be any holdups. Rumors of the merger first broke at the tail end of last week after being reported by Bloomberg.

RSI has been taking an aggressive approach to expansion in recent years and now has online sports betting products in five states and online casinos in Pennsylvania and New Jersey.

If this deal goes ahead and RSI becomes a publicly traded company, it will become the latest igaming firm to do so. In April, DraftKings went public through a merger with SBTech and Diamond Eagle Acquisition Group. Golden Nugget Online Gaming also announced at the end of June that it plans to go public on the Nasdaq exchange.

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