DraftKings Hit With Shareholder Suit Over SBTech Acquisition (1)

DraftKings Inc. was hit with a proposed securities class action Friday for allegedly failing to disclose that a company it acquired had a history of unlawful operations that exposed the company “to dealings in black-market gaming.”

The complaint cites a report published June 15, 2021 by Hindenburg Research alleging the merger with SBTech Global Ltd. “brings exposure to extensive dealings in black-market gaming, money laundering and organized crime.”

Hindenburg alleged that “SBTech has a long and ongoing record of operating in black markets,” estimating that half of its revenue is from markets where gambling is banned.

Based on the report, ...