Amy Howe, the former CEO of FanDuel, received a substantially more generous exit package than previously indicated following her departure from the sports betting giant in May.
As per Flutter Entertainment’s (NYSE: FLUT) recent SEC filing, Amy Howe’s separation agreement may total up to $21.2 million, a marked increase from the initial estimate of $4.37 million.
The substantial revision in the figure is largely due to Flutter’s disclosure that Howe is eligible for $12.5 million from a value creation plan (VCP) that was awarded on October 4, 2021, and is slated to vest on October 4, 2026.
In pro-rata calculations, Flutter is expected to pay Howe approximately $11.47 million in cash since she left before the full vesting period.
When adding the VCP to her originally stated severance of $4.37 million, Howe’s overall exit package rises to $15.84 million, not accounting for the additional $1 million in legal fees that Flutter covered on her behalf.
Following Howe’s exit, shares of FanDuel’s parent company saw a decline, suggesting that her separation terms were negotiated when the stock was trading at a higher valuation than currently.
This context indicates that the value of the restricted stock units (RSUs) granted to Howe could effectively elevate her total separation package to the aforementioned $21.2 million.
Speculations Surrounding Howe’s Departure
The announcement of Howe’s exit in May reverberated through the sports betting and investment sectors, leading to speculation that she might have been made a “fall guy” for the decline in her parent company’s stock price.
The truth of whether Howe was indeed scapegoated may remain unclear, given that her separation agreement includes confidentiality and non-disparagement stipulations.
“This confidentiality clause strictly prohibits, among other matters, the utilization or disclosure of Confidential Information for the benefit of any competitor or any entity preparing to compete, including through social media,” as stated in the regulatory filing.
Howe transitioned to interim CEO of FanDuel in July 2021, officially assuming the CEO role by October of that year.
This marked a significant period, occurring around three years post the Supreme Court decision on the Professional and Amateur Sports Protection Act (PASPA), which enabled states to regulate their own sports betting markets.
Under Howe’s leadership, FanDuel reinforced its stance as the leading sportsbook operator in the United States, establishing a significant presence alongside competitor DraftKings (NASDAQ: DKNG), while also expanding its iGaming reach.
Nevertheless, industry pressures from competing prediction markets have led to rising tensions among executives and investors, possibly influencing her departure, although Flutter has refrained from commenting on this matter.
Possible Windfall for Jackson
With Howe’s exit package nearing $21 million, investors may be curious about what sort of deal awaits Group CEO Peter Jackson.
Alongside its Q2 earnings announcement, Flutter revealed that Jackson will exit his roles as CEO and board member on September 30, yet will retain an advisory position until the end of 2026 to streamline the transition.
Dan Taylor, who is currently the CEO of Flutter’s international division and group president, is slated to succeed Jackson on October 1.