- The New York-based sports apparel company is expanding its sports betting footprint by acquiring PointsBet’s U.S. operations for $150 million.
- Currently, Fanatics offers sports betting in Tennessee, Ohio, and Maryland.
- If the deal is approved, Fanatics will acquire the rights to provide sports betting in 12 more states.
In a landmark acquisition, Fanatics Betting and Gaming is purchasing PointsBet U.S. for $150 million.
Known as a leading online retailer of official sports apparel, collectives, and goods, Fanatics has expanded its business model to the billion-dollar industry of sports betting.
Fanatics inked a deal with Nike and the NFL to be an official supplier of merchandise five years ago. Following their massive success in the retail industry, Fanatics jumped into the sports betting landscape.
In January 2023, Fanatics Betting and Gaming opened its first retail sportsbook. The sportsbook opened in conjunction with the NFL at the Washington Commander’s FedExField.
In a joint statement, the two companies noted that “Fanatics and PointsBet are excited to enter into an agreement for Fanatics Betting and Gaming to acquire PointsBet’s U.S. business”.
➖August 2020: raises $350M at $6.2B valuation
➖March 2021: raises $320M at $12.8B valuation
➖December 2022: raises $700M at $31B valuationNow, Fanatics has officially entered the sports betting landscape by acquiring PointsBet’s US operation for a reported $150 million.
— Boardroom (@boardroom) May 15, 2023
Fanatics Betting and Gaming Market Share Expanding Quickly
The news of Fanatics purchasing PointsBet’s U.S. operations is another big move for the company in 2023. Last year, Fanatics Betting and Gaming weren’t offering sports betting to the public.
Only a few months later, Fanatics Betting and Gaming opened a sportsbook inside an NFL stadium and expanded to two more states. On May 1, 2023, the company launched online sports betting in Ohio and Tennessee.
After having success in Ohio and Tennessee, there are several more states expected to be in line to offer online sports betting through Fanatics Betting and Gaming.
The sportsbook operator was approved for a license in Massachusetts in January and intends to launch sports betting in June. Expect to find Fanatics Betting and Gaming sports betting in several more states leading up to football season in September.
Currently, PointsBet offers sports betting in 14 states, including Ohio and Maryland. Fanatics already has a market share in Ohio and Maryland.
However, they do not in the other 12 states PointsBet has a license in, and Fanatics doesn’t currently offer online sports betting in Maryland.
Fanatics Expected To Enter Biggest Sports Betting Market In The U.S.
If the deal closes between Fanatics and PointsBet, Fanatics Betting and Gaming will instantly gain the keys to the largest sports betting in the country.
In 2022, New York set a state record for sports betting. With $16.2 billion wagered, New York has the U.S. record for most sports bets placed in a year.
PointsBet offers sports betting in New York, which means that Fanatics will now be able to enter this massive gambling market.
New York isn’t the only lucrative state that Fanatics could join as a result of the acquisition. PointsBet also offers sports betting in Illinois, Michigan, Colorado, Indiana, Iowa, Kansas, Louisiana, New Jersey, Pennsylvania, Virginia, and West Virginia.
Along with Fanatics closing in on launching a sportsbook in Massachusetts, Fanatics sports betting is going to be widely available throughout the country.
95 Million Retail Customers Potentially Exposed To Fanatics Betting and Gaming
Fanatics has an immense footprint in the online retail sports industry. Currently, Fanatics is an official partner of the NFL, NBA, MLB, NHL, PGA Tour, and NASCAR.
Marketing their sports betting should not be an issue for the company. It’s estimated that 95 million customers are currently in their online retail database.
This presents a tremendous opportunity for Fanatics to advertise their sportsbook to millions of customers. CEO Matt King mentioned at a press conference that this can be done without any significant costs to the company.
If you have ever bought anything on Fanatics and live in one of these states, expect to find an email regarding their new sportsbook. The difficult task for Fanatics will be convincing sports bettors to choose them over the competition.
What Does This Mean For Sports Bettors?
Note that the deal will not impact PointsBet in Canada and Australia. Sports bettors in Canada and Australia that have accounts with PointsBet will not be impacted.
The Fanatics acquisition is only for the PointsBet markets in the United States. The transition between PointsBet and Fanatics could take some time. PointsBet customers should not look for a Fanatics-branded sportsbook in the immediate future.
There are still some steps that Fanatics must take before the deal is ratified. Shareholders will have an opportunity to vote on the PointsBet acquisition. Additionally, regulators in the U.S. must approve the deal before anything goes forward.
Shareholders are highly unlikely to vote against this deal. Ultimately, regulators are likely to approve the acquisition as well. While it is not official, they should get to that point within the next few months.
Adding Fantatics to the sports betting foray introduces another recognizable brand to the scene. Look for promotions that combine the online retailer and sportsbook in the future.
With this purchase, Fanatics would like to launch sports betting in as many states as possible by the 2023 NFL regular season in September.
