Fanatics Closes Portion of PointsBet Deal, Adds Seven States to Roster

Posted on: August 31, 2023, 05:04h. 

Last updated on: September 1, 2023, 01:43h.

Todd Shriber @etfgodfather Read More
Expertise: Financial, Gaming Business, Mergers and Acquisitions.

Fanatics is moving along with its previously announced $225 million acquisition of PointsBet US, revealing on Thursday that it’s landed regulatory approval to acquire the target’s operations in seven states.

PointsBet Fanatics
The Fanatics and PointsBet logos. The former closed a portion of its acquisition of the latter, adding seven states to its sports betting roster. (Image: Sports Geek)

Those jurisdictions are Colorado, Iowa, Kansas, Maryland, New Jersey, Pennsylvania, Virginia, and West Virginia. Earlier this month, Fanatics announced the debut of its mobile sports wagering application in Maryland, Massachusetts, Ohio, and Tennessee, meaning the company will be operational in 11 states in advance of the start of the 2023 NFL season.

While 11 states are slightly short of Fanatics’ previously announced, goal of being live in 12 to 15 states before the start of football season, getting close to that number is impressive when considering it’s been just two months since Fanatics and PointsBet came to terms on the aforementioned transaction.

As each state closes and officially becomes part of Fanatics Betting and Gaming, customers in such state will see PointsBet rebranded to ‘PointsBet, a Fanatics Experience,’ with additional state closings to continue throughout the year,” according to a statement.

Fanatics added that customers in Illinois and Indiana will continue seeing PointsBet USA branding until the buyer receives regulatory approval in those states later this year.

Other Ins and Outs

Shareholders of Australia-based PointsBet (OTC: PBTHF) recently approved the cash distribution tied to the sale of U.S. operations to privately held Fanatics.

In addition to Illinois and Indiana, PointsBet will continue operating in Louisiana, Michigan, New York, and Ohio until Fanatics lands regulatory approval in those states. Each is an important jurisdiction for sportsbook operators. New York, a market Fanatics founder and CEO Michael Rubin previously lambasted because of high taxes on sports betting, is the largest sports wagering market in the U.S. That makes it a crown jewel in the purchase of PointsBet US.

“PointsBet USA will continue to employ engineers, customer service teams, traders, marketing and compliance teams with a new influx of operating capital from Fanatics Betting and Gaming,” added the buyer in the statement. “Johnny Aitken will continue as the CEO of PointsBet USA, and customers will continue to enjoy the most markets on all four major U.S. sports, including up to 1,000 markets per NBA game, and the quickest, most user-friendly app on the market today.”

PointsBet US also offers iGaming in four states. Fanatics Betting and Gaming is headquartered in New York.

Other States Fanatics Could Evaluate

The list of other states in which Fanatics Betting and Gaming could eventually look to procure licenses is arguably compelling.

It includes North Carolina, Tennessee, and Arizona, though that could be a longer-ranging quest. It’s expected Fanatics Betting and Gaming will be operational in Kentucky when regulated sports wagering launches there next month.