Key Points
- Candle Lake made a filing with the SEC on Schedule 13G regarding 28.58 million shares of DraftKings Class A stock, which is valued at about $691.94m currently.
- Now, Dart has financial interests in the two largest online sports betting platforms in America, FanDuel parent company Flutter Entertainment and DraftKings, although a paper loss continues to grow in Flutter.
- Jason Robins, the CEO of DraftKings, owns more than 90% of Class B shares, which have ten votes per share, so the activist influence on DraftKings by Dart in Class A is structurally impossible.
The Man Who Buys What Everyone Else Is Selling
Kenneth Dart does not hold press conferences or grant interviews. What he does, consistently and without announcement, is buy large positions in out-of-favour sectors and let the mathematics of patience do the rest. He did it with distressed sovereign debt from Argentina, Brazil, and Greece. He did it with tobacco, quietly building stakes in British American Tobacco and Imperial Brands when ethical investors were heading for the exit. Now he is doing it with gambling stocks, and his latest move raises a question worth paying close attention to.
A filing by the SEC of Schedule 13G on 14th August 2026 reveals that the Cayman Islands-based investment fund of Dart, Candle Lake has purchased 28,581,386 DraftKings Class A shares, equating to 5.8 per cent of their outstanding shares. With a stock value of $24.04 for DraftKings, the position held is worth around $691.94m. However, what makes this more fascinating is not so much the value of the position but rather who owns it.
A Passive Filing With a Very Active Subtext
The filing type carries meaning. A Schedule 13G covers passive investors who have crossed the 5% ownership threshold with no intention of influencing management. That is the box Dart has ticked, though at DraftKings, activism would be structurally blocked regardless of his intentions.
Co-founder and CEO Jason Robins controls more than 90% of the company’s Class B shares, each carrying ten votes. DraftKings ‘ Class A shares carry one vote each. No matter how far Candle Lake’s position grows, the voting arithmetic is fixed in Robins’ favour. This is a financial bet on where DraftKings’ share price is headed, nothing more.
Dart Now Owns Both Sides of the US Sports Betting Market
Here is the detail that most coverage has missed entirely. Dart does not just own DraftKings. He controls roughly 29% of Flutter Entertainment, the Irish-incorporated parent of FanDuel, through a mix of direct shares and total-return swaps. FanDuel and DraftKings are the two dominant US sportsbooks, and Dart now has meaningful financial exposure to both simultaneously.
This is not a contradiction; it is the point. Dart is not picking one platform over the other. He is backing the US online gambling market itself, treating it the way he has treated other sectors throughout his career: as an undervalued category where patient capital, spread across multiple positions, eventually gets paid. His gambling portfolio already includes Evolution AB, the world’s leading live casino supplier, and a 0.6% stake in Swedish iGaming content distributor Hacksaw AB. DraftKings adds the second half of the US sportsbook duopoly.
Dart is also not alone in this view. Michael Burry, the investor known for his 2008 subprime short, disclosed stakes in both DraftKings and Flutter last month. Two contrarian names in global finance, positioned in the same beaten-down sector simultaneously, are not a coincidence worth ignoring.
Flutter Is Down $4.2bn and Dart Is Still Holding
Flutter’s share price has fallen more than 57% from its 52-week peak of $309.40. Dart’s Flutter position is sitting on a reported paper loss of approximately $4.27bn against an initial investment of around $7.62bn. That is a significant figure, yet Dart has not reduced its exposure. His total-return swaps on Flutter have been rolled forward to 2028, and he has continued adding swap exposure, now totalling more than 21.7 million notional shares.
Flutter has had a turbulent year. FanDuel’s CEO was replaced in May after missing growth targets, and Flutter CEO Peter Jackson announced he would step down on 1 October, handing the reins to Dan Taylor, head of the company’s international operations. Prediction market platforms have added further pressure on margins across the US sector.
None of that has pushed Dart toward the exit. His combined Flutter position sits near 29%, and crossing the 30% threshold would trigger Irish Takeover Rules, requiring Candle Lake to make a mandatory offer for the rest of the company’s shares. Flutter is incorporated in Ireland, so Irish takeover law applies regardless of its New York and London stock listings. Dart crossed the equivalent Swedish threshold at Evolution just weeks ago, and the outcome there shows exactly how he handles these moments.
What the Evolution Situation Tells Us?
When Candle Lake’s holding in Evolution AB crossed 30%, Swedish law required a mandatory offer for the remaining shares. Candle Lake filed that offer on 14 August, valuing Evolution at SEK131.7bn (£10.21bn), well below the company’s market cap of SEK154.12bn and pitched at a 5.7% discount to the last closing price. It was not designed to succeed.
Candle Lake’s own statement confirmed the posture. “Candle Lake is a long-term investor and views its shareholding in Evolution as a financial investment in a well-managed, highly profitable business. The offer is not motivated by any intention to acquire all outstanding shares in Evolution.” The acceptance period runs to 15 September 2026. The pattern is clear: cross the threshold, file the minimum required offer, declare no interest in full control, and stay invested.
DraftKings’ Stock Is Falling, Its Business Is Not
For anyone trying to understand why Dart finds DraftKings worth nearly $692m of Candle Lake’s capital right now, the operating numbers are the starting point. The stock has dropped 32.5% in 2026 and 46.6% over the past twelve months. The business, though, is heading in a different direction entirely.
The company generated revenue of $1.646 billion in Q1 2026, reflecting an increase of 17% compared to the same period in the previous year, while sportsbook revenue grew 24% to $1.095 billion, and iGaming revenue increased 8.9% to $461.3 million. The adjusted EBITDA increased by 599%, from $24 million in Q1 2025 to $167.9 million, while net income was $21.1 million against the losses recorded in the previous year.
CEO Jason Robins said in the Q1 earnings release: “Our core business is strong, and profitability is inflecting. That gives us the firepower to press our advantage in Predictions.” The company has since launched a $600m term loan and upsized its revolving credit facility to $750m, partly to retire 2028 convertible notes, extending its financial runway through 2031. Of 25 analyst ratings on TipRanks, 22 are “Buy” and three are “Hold,” with Benchmark Company’s Mike Hickey carrying a $30 target price.
Expert Analysis
Dart’s DraftKings move fits the pattern that has defined his entire investing career: find a sector where sentiment has collapsed sharply, where solid underlying businesses are being priced as though the worst outcome is already certain, and take a position large enough to matter. He did it with tobacco when ESG pressure was peaking. He is doing it now with gambling stocks as the sector absorbs regulatory costs, prediction market competition, and a stock market that has not reflected the industry’s revenue growth.
The Class B voting structure means Dart cannot push DraftKings management in any direction; Robins’ control over votes is absolute. What Dart can do is hold, and potentially add. Across Evolution, Flutter, and now DraftKings, his approach has been to accumulate under pressure rather than retreat when positions move against him. The 5.8% filing is where Candle Lake’s DraftKings story starts. Whether it stays there is the number worth watching next.
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