Fanatics buying out PointsBet in landmark $150M deal

The signs have been in the air. Fanatics, an apparel brand with long-time professed ambitions to enter the sports betting space, has agreed to buy out PointsBet’s US business, offering $150m in cash, Yahoo News and various other outlets confirmed, citing company updates and media statements.

This comes shortly after PointsBet confirmed in another company update that it is looking to exit the US market and refocus its efforts elsewhere. The new opportunity is an important milestone for Fanatics as well, a company which was recently able to go ahead with its launches of sportsbooks in both Ohio and Tennessee on Monday, May 1.

Fanatics is already planning to break ground in Massachusetts and Maryland in June, and the new acquisition of PointsBet will significantly strengthen Fanatics technological expertise and clout. The deal, though, is still not finalized, as it would first need the approval of shareholders. This is scheduled for later in June.

Fanatics will offer $100m upon deal completion, and then another $50m which will be paid in February 2024. PointsBet has confirmed that it will make sure that the sale proceeds are then distributed amongst its shareholders, or around $0.71-$0.73 per share. Fanatics and PointsBet have still cautioned about the steps that follow next, but both parties confirmed that they are confident in the successful completion of this deal.

"Fanatics Betting and Gaming and PointsBet will provide further details of the proposed deal and timely updates in the coming weeks," the firms said. Fanatics is finally delivering on its long-anticipated business entry into the sports betting market. It has been a somewhat rough journey, too in the regulated market, as not every company has been a success.

MaximBet, the sports betting arm of the namesake lifestyle brand, has had to fold its operations due to mounting costs. Fanatics, however, is prepared for the financial crunch that may follow. The company has put in more than $1bn to see this project through and it is prepared to weather some choppier patches ahead.

Fanatics has a massive user database that allows it to rapidly connect with potential audiences and distribute its newly-fledged sports betting product with precision and a highly-personalized and tailored approach. As the deal draws closer to completion, a new sports behemoth is entering the space – whether it overshoots remains to be seen.

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