The Fanatics logo is seen on a dugout wall before the Pittsburgh Pirates and Milwaukee Brewers game 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 foray into US sports betting.
The deal is worth about $150 million in cash. The companies announced the deal shortly after CNBC reported it had reached an agreement.
“Fanatics and PointsBet are delighted to have signed an agreement for Fanatics Betting and Gaming to acquire PointsBet’s U.S. business,” the companies said in a joint statement. “While there are still some steps in the process of completing the acquisition, both parties are confident in the outcome. Fanatics Betting and Gaming and PointsBet will provide more details on the proposed deal and update timely updates in the coming weeks.”
Fanatics will have access to at least 15 states with the deal, according to people familiar with the agreement, who declined to be named because the discussions are private. According to one of these people, the fanatics hope to gain access to the majority of states where PointsBet operates at the start of the NFL season.
PointsBet, whose shares are traded in Australia, is expected to hold a shareholder vote on the deal at the end of June. Only PointsBet’s US assets are part of the agreement. The fanatics will be planning to fund some of the burned leftovers from PointsBet, which has had to spend a lot on marketing to compete with bigger rivals Draft Kings and FanDuel.
PointsBet forecasts a loss of between $77 million and $82 million in the second half of this year. The company said on Sunday that it would need to raise more capital in the near term if the deal with Fanatics somehow falls through.
NBC Sports bought a 4.9% stake in PointsBet in 2020.
Fanatics has negotiated with several different sports betting companies in the last year as it has outlined the way forward in mobile gambling.
“This has been a 10-year journey,” Matt King, CEO of Fanatics Betting, said at the SBC Conference earlier this month. “We’re going to move very methodically on that 10-year journey. And by doing that and taking that approach, it allows you to be a little more deliberate in your decisions. Today, you can move slower, a little slower, in order to move fast afterwards.”
Fanatics is a sports platform company with a private valuation of $31 billion. The company has forecast 2023 revenue of $8 billion.
Fanatics owns commercial properties, operates a sports trading card business, and is building a sports betting division. The company acquired the legendary trading card company Topps for $500 million last year.
Disclosure: NBCUniversal is the parent company of NBC Sports and CNBC.
