On 16 June, DraftKings tabled a non-binding indicative proposal to purchase PointsBet for $195.0m on a debt-free, cash-free basis with no financing conditions. PointsBet’s board will assess the proposal, which does not constitute a binding offer from DraftKings. Fanatics CEO, Rubin, expressed skepticism towards the proposal, calling it a desperate attempt to slow down Fanatics’ own deal with PointsBet. The original deal between Fanatics Betting and Gaming (FBG) and PointsBet would grant access to 12 states, including major betting and igaming hubs like New York, New Jersey, Pennsylvania, and Michigan. If PointsBet chooses the DraftKings proposal, FBG would need alternative routes to these markets. FBG’s offer of $150.0m allows PointsBet to retain its Canadian and Australian businesses and operations and continue as a listed company on the Australian Stock Exchange. PointsBet would also retain its proprietary sports wagering, racing, and igaming platform and be granted a royalty-free license to exploit Banach technology assets. PointsBet’s board will compare the DraftKings proposal to the FBG deal in terms of shareholder value and completion feasibility, and currently recommends that shareholders vote in favor of the FBG transaction.
In Q1, PointsBet experienced a 39% YoY rise in revenue to AU$106.6m, driven by growth in its North American operations. However, the Australian arm saw a 3% drop to $50.7m. The company expects to make an EBITDA loss of between $77.0m and $82.0m for H2 FY23 and has been cutting costs to drive profitability. PointsBet has been in talks with multiple parties regarding the sale of its North American business, while terminating previous talks to sell its Australian business to a News Corp-backed gaming venture. Despite ongoing discussions, the company remains focused on the FBG deal and recommended that shareholders vote accordingly.
