PointsBet shareholders approve $225M acquisition proposal by Fanatics

Fanatics set to acquire Pointsbet’s U.S. sports betting operations in $150 million deal

Online retailer Fanatics emerges victorious in the race for PointsBet’s U.S. business. The sportsbook’s shareholders have approved its acquisition proposal worth $225 million.

On Thursday, PointsBet’s extraordinary general meeting saw a 99.16 percent vote in favor of the sale. The completion date for the takeover is yet to be announced. A Fanatics spokesperson expressed the firm’s excitement over the news in a statement.

“This is a pivotal moment for Fanatics Betting and Gaming that will accelerate our growth in the legal online sports betting, advance deposit wagering, and iGaming markets in the United States,” said the spokesman.

“Pending regulatory approvals in the various states in which PointsBet operates, we will have more details to share in the coming weeks on how the acquisition of PointsBet US businesses will bring to life our unique vision for Fanatics.”

Fanatics revises offer

On Tuesday, the PointsBet board granted approval to the sale agreement. They “unanimously recommended” shareholders to vote in favor of the proposition.

Earlier this week, Fanatics revised its offer from $150 million to $225 million. The retailer raised the offer after their first proposal with PointsBet was outbid by DraftKings at $195 million. DraftKings then withdrew from pursuing the acquisition upon confirmation of Fanatics’ improved offer.

Before the vote, PointsBet chairman Brett Paton spoke to shareholders about the reason behind the decision to sell the U.S. business. Paton explained that PointsBet had achieved important goals in the U.S. market. Yet, the expenses of competing with established brands will soon prevent the business from generating a positive cash flow.

“Continuing to operate the U.S. business would require significant capital and further capital raises,” he said. “This transaction addresses that uncertainty.”

Paton also explained that FanDuel and DraftKings had achieved remarkable success. The two bookmakers account for around 80 percent of the U.S. sports betting market. Paton said most established brands have struggled to match the pace set by these two operators.

Among around 60 online sports betting companies operating in the U.S., only seven have secured a market share of one percent or higher, including PointsBet.

Paton pointed out that a sportsbook had invested $2.5 billion but could not attain a mid-single-digit market share. Additionally, several well-funded online operators have needed help gaining significant traction. Meanwhile, numerous others have ultimately shut down.