Fanatics Betting and Gaming has closed on its acquisition of PointsBet’s US operating businesses across eight states.
The completed states – Colorado, Iowa, Kansas, Maryland, New Jersey, Pennsylvania, Virginia, and West Virginia – represent the first eight where Fanatics has received all the necessary regulatory approvals to complete the acquisitions.
Transactions are still to be completed in other states including Illinois, Indiana, Louisiana, Michigan, New York and Ohio.
In the states where the acquisitions have closed, PointsBet operations will be rebranded to “PointsBet, a Fanatics Experience”.
Customers in Illinois and Indiana will also witness the rebrand in the coming months, Fanatics said, but PointsBet’s operating businesses in those states will continue to be operated by PointsBet USA until Fanatics closes its acquisitions there later this year.
Fanatics added that the acquisition complements the growth and diversification that its Betting and Gaming division has accomplished over the past two years.
In addition to its sports betting brand, platform and technology, Fanatics will also add PointsBet’s online casino platform to continue the development of its iGaming operations scheduled for launch later this year.
Further, PointsBet’s proprietary Banach technology – included as part of the acquisition – will be integrated into the Fanatics Sportsbook app currently available in Maryland, Massachusetts, Ohio and Tennessee.
New and current PointsBet customers will be able to “become part of the Fanatics family,” the business added, with new promotions planned for the upcoming American football season.
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, the company said.
Meanwhile, Johnny Aitken will continue as the CEO of PointsBet USA.
“We are excited about what we are building at Fanatics Betting and Gaming and this acquisition accelerates our plans,” said Matt King, CEO of Fanatics Betting and Gaming.
“We have a 10-year plan that focuses on the customer and not market share.
“We are going to acquire customers efficiently, allowing us to return savings to customers by investing in the customer experience at Fanatics Sportsbook and PointsBet, a Fanatics Experience.”
PointsBet’s remaining business
In its latest annual earnings report, PointsBet explained that it would continue to focus on its core Australian business, which generated A$211.7m in net win during the financial year 2023, as well as its Canadian business, which generated A$18.3m.
With the Canadian operations still far behind its Australian business, PointsBet CEO Sam Swannell said the company saw the regulated province of Ontario – as well as the possibility of other regulating provinces, such as Alberta – as its key growth drivers moving forwards.
Those comments came amid a 1.7% reduction in its Australian revenue in FY23, as a result of a tough comparative period which saw outsized earnings for online operators in Australia during the Covid-19 pandemic.
Despite the reduction in revenue, which took place across the Australian market, Swannell suggested that the business had in fact increased its market share in Australia during FY23.
PointsBet has unveiled its first major operational presence outside of Australia and North America after opening a new European headquarters in Dublin, Ireland.
The new headquarters is based in The Liberties, which is described as the capital’s innovation district and was designed to attract world-class technology start-ups.
Dublin’s Silicon Docks has become one of the leading lights of Europe’s tech scene over the last decade. The city is now home to offices of companies including Google, Meta and Twitter, among others.
The ASX-listed operator could potentially hire up to 300 employees in the Irish tech hub over the next three to five years, according to PointsBet US CEO Johnny Aitken.
PointsBet already had some Irish heritage following the €43m acquisition of Dublin-based betting software company Banach Technology in 2021. That company’s headcount of around 70 is now based in PointsBet’s new Irish HQ.
Since the acquisition, the PointsBet product has been built on Banach’s proprietary sportsbook technology, which also includes in-house risk management and trading platforms.
This has become a major asset for the group and has seen PointsBet linked to some major M&A activity in the global online gambling space as a potential acquisition target.
PointsBet has become increasingly interlinked with Dublin in June. Last week, the company announced it had received a A$94.2m strategic investment from Susquehanna International Group (SIG).
Crucially, SIG also owns Dublin-based Nellie Analytics, which will provide additional sports analytics and quantitative modelling services to PointsBet as part of the agreement.
PointsBet shares have climbed steadily since the SIG deal was announced. After an 18.6% rise in the wake of the initial announcement, PBH shares closed 10.7% higher yesterday and are up 9.8% over the course of the last week.
PointsBet is concentrating on its core markets of the US, Canada and Australia, with tech, software and development support provided from Europe via Ireland.
Aitken told The Irish Times: “The Irish people understand US sports betting back to front, they love baseball, college basketball and NFL. I’ve been so surprised how much they have a passion for US sports.
“While we have teams working on the US sports betting opportunity that are not based in the US itself, that is more than compensated by the fact that they absolutely have a passion for these sports,” he added.