Fanatics Buys PointsBet’s US Business for $150 Million
Fanatics is a privately held corporation that wants to get in the legal US sportsbook industry in a meaningful way. The sports apparel company formed the sports gaming division a few years ago and it was looking for a sportsbook operator right here in the US market. Australian-based PointBet was shopping its US sportsbook business and the two companies made a deal for $150 million in cash.
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Both Fanatics and PointsBet, in the joint statement, recently announced that the transaction will take place following PointsBet public shareholders’ meeting in June. The statement said:
“Fanatics and PointsBet are excited to enter into an agreement for Fanatics Betting and Gaming to acquire PointsBet’s US business. While there are still several steps in the process to complete the acquisition, both parties are confident in the outcome. Fanatics Betting and Gaming and PointsBet will provide details of the proposed deal and timely updates in the coming weeks.”
The only US business of PointsBet is the transaction with Fanatics Betting and Gaming. The company is retaining its Canadian sportsbook industry in Ontario.
PointsBet’s US Sportsbook Has Been a Takeover Target
Fanatics’ recent deal to take over the legal US sports betting market of PointsBet is part of the plan that sells off an unprofitable piece of the whole operation. Both Bally’s Corporation and Penn’s Entertainment were also mentioned for the US-based sportsbook division of PointsBet.
According to the Australian-based company:
“PointsBet’s current corporate cash balance is insufficient to fund the US Business through to profitability, and as such, should the Proposed Transaction not proceed, the Company would need to raise capital in the near term.”
In 2020, NBCUniversal acquired 4.9% equity in PointsBet and that company should receive compensation for the US sports betting market when it transfers to Fanatics Betting and Gaming.
Fanatics is a Valuable Commodity
In December of 2022, Fanatics was valued at $31 billion in private markets. Led by Michael Rubin, this is one of the most successful sports apparel companies in the world. Fanatics has trademarks for all the major US sports brands including the NFL, NBA, NHL and MLB.
The company expanded with the US sports betting industry and the next step was a takeover of a seasoned sportsbook operator. PointsBet USA had been mentioned along with BetParx, Tipico, Rush Street Interactive, Twin Spires Sportsbook, Betsson and WynnBET.
Fanatics Betting and Gaming has a way of jump-starting the legal sports betting market with the US business of PointsBet. The goal for starting a retail and online sportsbook in a dozen or more legal states is very feasible this football season. Fanatics Sportsbook launched in Maryland’s FedEx Field on Jan. 20 in 2023.
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