Fanatics will purchase PointsBet’s US business for $150 million, consolidating the somewhat crowded sports betting space, and also giving the company a strong first step into the industry.
Later this month, Fanatics is expected to debut its sportsbook in Massachusetts, marking its first entrance into the sports betting market. It also had planned to get into the Maryland sports betting market eventually, and the acquisition of PointsBet makes that path forward more clear.
PointsBet is based in Australia, but the deal with Fanatics, which will not be approved until at least June, only includes the company’s holdings in the United States.
Fanatics had plans to launch sportsbook in Maryland
Fanatics has been poised to launch a sportsbook for some time, and ever since it hired Matt King away from FanDuel in 2021, that move has been anxiously anticipated by gaming observers.
The Fanatics brand, built on the strength of licensed sports apparel and collectibles sales, is well-known among sports fans in North America. The company reportedly has a list of existing customers that numbers in the millions. Last week at SBC Summit North America, King explained that his company was more interested in “getting it right, than in being fast” to the market. With the acquisition of PointsBet, Fanatics acquires a mature sports betting platform that also includes in-play technology from Banach, a company PointsBet bought two years ago.
Fanatics currently has access to four states for sports betting on its own: Maryland, Massachusetts, Ohio, and Tennessee. However, it has yet to launch a sportsbook app in any of those states.
With the purchase of PointsBet (a move that prompted an 18% stock drop in Australian markets), Fanatics can presumably gain market access to five new states: Illinois, Michigan, New York, Pennsylvania, and Virginia. It’s likely each state will need to vet Fanatics before it could assume the licensure that belonged to PointsBet in those states.
What will happen to my PointsBet account?
PointsBet shareholders and its board of directors will need to approve the Fanatics transaction at company meetings next month. But, that should be a formality. Once the deal is finalized, customers in the US will likely see changes to the branding of the PointsBet app quickly.
The Fanatics announcement suggests that the company has not purchased the proprietary PointsBet platform for operations in the US. Instead, that technology remains the property of PointsBet. As a result, PointsBet users may not see a marked difference in the sportsbook following the sale.
For consumers in other states where Fanatics was planning to launch in 2023, it could happen quicker now that the company has an established platform in its portfolio.
However, it remains to be seen if Fanatics would roll the “points betting” model into a Fanatics sportsbook along traditional style of betting, or keep those products separate.