Fanatics Inc. will buy the U.S. operations of Australia’s PointsBet for about $150 million, in the company’s largest foray yet into sports betting.
PointsBet is an online sportsbook that launched in the U.S. in 2019, and operates in 15 states, including New Jersey, Iowa, Illinois and Colorado.
“Despite the strategic success building a valuable asset in the U.S., the costs of operating in a state-by-state environment, together with the requirement to build significant scale to compete against well capitalized operators, led us to explore a number of options,” PointsBet Chief Executive Sam Swanell said in a statement. “The sale of the U.S. Business to Fanatics Betting and Gaming delivers the most attractive risk-adjusted value outcome for shareholders compared to the risks and benefits of other options including the status quo.”
PointsBet shareholders are expected to vote on the sale at their annual meeting in late June.
The deal should increase pressure on U.S. sports-gambling companies such as DraftKings Inc. DKNG,
In an interview, Fanatics CEO Michael Rubin told the Journal he wants Fanatics to be the world’s top sports-betting company within the next 10 years, and expects its betting operations to be profitable by 2025 or 2026.
In December, Florida-based Fanatics — which got its start in sports apparel and collectibles — closed a $700 million funding round, valuing it at about $31 billion, the Wall Street Journal reported. The privately held company is expected to eventually launch an IPO.
Last year, Fanatics acquired trading-card company Topps.