Posted on: January 6, 2022, 10:27h. 

Last updated on: January 6, 2022, 11:04h.

Fanatics has a well-documented desire to enter the sports wagering arena. It may have held takeover talks with Australia’s PointsBet (OTC:PBTHF), before ultimately deciding against the deal.

Fanatics
Fanatics CEO Michael Rubin in a 2020 interview with CNBC. He reportedly passed on buying PointsBet. (Image: CNBC)

Two unidentified sources tell the New York Post that about a year ago, Fanatics was discussing a buyout with PointsBet. That’s before Executive Chairman and CEO Michael Rubin examined the Australian company and opted against a transaction.

Rubin saw the inside of PointsBet’s operations and decided instead of buying an operator to build a business organically,” the Post reports, citing one of the sources.

Passing on PointsBet ultimately backfired on Fanatics. Rubin’s company is known primarily for its dominance in sports merchandise, and more recently, a rapidly expanding footprint in the fast-growing trading card business. It decided to pursue a New York sports wagering license in partnership with rap star Jay-Z and Barstool Sports founder David Portnoy.

Regulators in the fourth-largest state rejected that application. But the New York State Gaming Commission approved bids for nine sports betting mobile apps in the state, one of which is operated by PointsBet. Caesars Sportsbook, DraftKings, FanDuel, and Rush Street Interactive will launch there on Saturday, while the other five operators, including PointsBet, move toward final approval.

Fanatics Tied to Plenty of Takeover Rumors

The old saying, “Always a bridesmaid, never a bride,” could easily be applied to Fanatics. That’s because the privately held company is frequently at the center of industry consolidation rumors, but it hasn’t actually executed a sports wagering-related acquisition.

Without naming specific companies, the Post article notes Fanatics held talks with other operators in addition to PointsBet. In September, it was reported that Fanatics was holding discussions with Rush Street Interactive (NYSE:RSI) and Swedish gaming giant Betsson.

Four months later, no deal has materialized. Last month, Fanatics was floated as a potential suitor for Churchill Downs’ (NASDAQ:CHDN) TwinSpires Racing unit. However, it’s not confirmed the Kentucky Derby operator will even part with that business. And there’s growing consensus among analysts it will not divest TwinSpires.

It’s possible Fanatics revisits a deal with PointsBet, though no talk of that has emerged as of yet. If it does, it faces the possibility of enriching a rival. Penn National Gaming’s (NASDAQ:PENN) Penn Interactive Ventures took a 6.27 percent stake in the Aussie gaming operator last year.

Fanatics Not Going Quietly

Whether or not Fanatics uses acquisitions to get into sports wagering remains to be seen. But it’s likely the company isn’t letting the PointsBet misstep stand in its way.

In October, it filed several patent applications with the US Patent and Trademark Office (USPTO). They call for a branded casino, mobile betting app, and sportsbook.

Valued at $18 billion in private markets last year, Fanatics has the resources with which to go shopping. Additionally, some market observers believe the company will break into sports wagering later this year by renting other operators’ licenses in some states in a exchange for a slice of revenue, according to the Post.

(this story/news/article has not been edited by PostX News staff and is published from a syndicated feed)

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