Fantasy sports tech companies DraftKings and FanDuel agreed on Friday to merge.
The companies said the merger would allow greater investment in "growth opportunities and an accelerated path to profitability."
"We have always been passionate about providing the best possible experience for our customers and this merger will help advance our goal of building a transformational global sports entertainment platform," DraftKings CEO Jason Robins said in a statement.
The companies agreed that Robins will be CEO of the new company and FanDuel CEO Nigel Eccles will be chairman.
The companies said the transaction is expected to close in 2017.
The companies reached an agreement in March with New York Attorney General Eric Schneiderman to stop running paid contests in the state.
Schneiderman had sought to shut down the companies' operations, arguing their contests relied on chance and were illegal under state law. DraftKings and FanDuel had stressed their contests require skill.
Disclousre: NBC News' parent company, Comcast, and NBC Sports are among the investors in FanDuel.