As of May, DraftKing had net debts of $US1.25 billion.
PointsBet said it would consider the bid, but reiterated it had already engaged in a long and arduous process to find a buyer, which resulted in the offer from Fanatics last month. It is unclear if the latest offer will lead to a new and improved offer from Fanatics, backed by rappers including Jay-Z, Meek Mill and Maverick Carter, along with the NFL and SoftBank.
PointsBet chief executive Sam Swanell told The Australian Financial Review in May that he had agreed to sell to Fanatics because of the transaction’s structure, which limited cash burn in the North American business.
“You had a situation [in 2018] where pretty much every online betting company in the world targeted that market,” Mr Swanell said. “It is expensive, the cost of doing business there because it’s a state-by-state market. You need scale.”
PointsBet was forecast to lose between $115 million and $123 million in the six months to June 30. Mr Swanell said the company’s losses would be capped at $US21 million until the transaction closed. The deal also included an exclusive wagering agreement with US media giant NBC Universal.
Fanatics is a multi-platform sports company with businesses across commerce, merchandise, trading cards and sports betting. It has a private market valuation of $US31 billion.
PointsBet shares closed up just 0.5¢ on Friday at $1.36. They have fallen more than 33 per cent in the last 12 months alone.
The company had appointed Moelis & Co as it attempted to sell its North American business. It is still considering a sale of its Australian operations, and had Flagstaff engaged as it considered local possibilities.
It previously held discussions with News Corp-backed Betr, rejecting a $220 million bid last June. Others that have looked at the Australian bookmaking division include London-listed Entain and ASX-listed Tabcorp.
Mr Swanell has previously said that, following the sale of the US business, the other operations in Australia and Canada would “break even” within 12 months. The Australian Financial Review reported this week that PointsBet and Sportsbet, owned by London-listed Flutter Entertainment, were interested in a non-exclusive wagering licence in Victoria.
Tabcorp and Athens-headquartered Intralot have emerged as the only two parties with interest in bidding for a lucrative, exclusive Victorian wagering licence. It gives the holder the right to sell specific products and operate betting in shops and pubs in one of the largest markets in the country.
