The Fanatics logo is seen on the dugout wall prior to the game between the Pittsburgh Pirates and the Milwaukee Brewers at PNC Park on July 3, 2022 in Pittsburgh, Pennsylvania. (Photo by Justin Berl/Getty Images)
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Fanatics has agreed to acquire PointsBet’s US operations, marking the sports giant’s first big step into US sports betting.
The deal is worth around $150 million in cash. The companies announced the deal shortly after CNBC reported that a deal had been reached.
“Fanatics and PointsBet are delighted to enter into an agreement for Fanatics Betting and Gaming to acquire PointsBet’s US business,” the companies said in a joint statement. “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 further details on the proposed agreement and timely updates in the future. coming weeks.”
Fanatics will have access to at least 15 states with the deal, according to people familiar with the deal who declined to be named because the discussions were private. Fanatics expects to have access to the majority of states where PointsBet operates by the start of the NFL season, according to one of the people.
PointsBet, whose shares are traded in Australia, is expected to hold a shareholder vote on the deal in late June. Only PointsBet’s US assets are part of the deal. Fanatics plan to fund some of the remaining cash burn from PointsBet, which has had to invest heavily in marketing to compete with bigger rivals. DraftKings and FanDuel.
PointsBet expects a loss of between $77 million and $82 million for the second half of the year. The company said on Sunday that it would need to raise additional short-term capital if the deal with Fanatics somehow collapses.
NBC Sports acquired a 4.9% stake in PointsBet in 2020.
Fanatics has been in talks with a number of sports betting companies over the past year as it forges its path into mobile gaming.
“It’s been a 10-year journey,” Fanatics Betting CEO Matt King said at the SBC conference earlier this month. “We’re going to move very methodically through this 10-year journey. And by doing that and taking that approach, it allows you to be a little more thoughtful in your decisions. You can kind of move slower, a a little slower today, in order to go faster later.”
Fanatics is a sports platform company with a private valuation of $31 billion. The company forecasts revenue of $8 billion in 2023.
Fanatics owns business assets, a sports trading card business and is developing a sports betting division. The company acquired legendary trading card company Topps to $500 million last year.
Disclosure: NBCUniversal is the parent company of NBC Sports and CNBC.