The company Fanatics is a one-stop destination for sports fans to buy apparel. However, the brand has continued to explore ways to get into the sports betting business after failing to secure a bid to enter the New York sports betting market.
Fanatics Has Explored Many Different Options
The renowned apparel company was looking to enter the sports betting industry. Sadly, state regulators in the Empire State went towards handing out approved licenses to two other groups that were led by DraftKings, FanDuel, and others.
Fanatics was even linked to taking other routes by the way of partnerships with other sportsbook operators like PointsBet and WynnBet.
Wynn Resorts was on a path of selling its online sports betting unit at a discount of $500 million after a failed attempt to go public with a $3.2B SPAC transaction with Austerlitz Acquisition Corp in November.
The brand even tried to work out a deal with Kambi and Strive Gaming on a more traditional B2B deal. However, the company had long-term aspirations and wanted to own its technology. Fanatics’ CEO Michael Rubin stated recently;
“We can be the No. 1 player in the world in sports betting in 10 years.”
What is Fanatics Exactly Acquiring
According to experts in the sports merchandise industry, Eilers and Krejcik Gaming first reported they acquired a copy of platform source code from B2B supplier Amelco. Amelco is a B2B provider of technology services to the financial trading, lottery, online casino, and sports betting industries and offers many more things.
The acquisition will reportedly cover the full tech stack that includes player account management (PAM) and a sportsbook engine. Fanatics will also pay Amelco an upfront fee for the code and a continuing share of the revenue.
Amelco will handle trading and operations, while Fanatics gradually takes control as it builds out its sportsbook’s operation team. The brand is currently hiring over 20 positions to fill that role.
The financial terms of the deal aren’t available to the public at the moment. Many speculate that the acquisition could be over $100 million. This would be Amelco’s most significant transaction ever.
However, this isn’t the first time Amelco has sold its source code to sportsbooks in the United States. The list includes Hard Rock Sportsbook, Fox Bet, Fubo Sportsbook, and PlayUp. Intralot and Hong Kong Jockey Club also use their source code outside the United States.
There is Still Work That Needs to be Done
However, it’s safe to say that Hard Rock Sportsbook, Fox Bet, Fubo Sportsbook, and PlayUp don’t have the same amount of resources as Fanatics. The transaction also means that it will need to work on its own market access deals to have the chance of receiving approved licenses across numerous jurisdictions.
Fanatics hasn’t rushed the process and has the funds as it’s privately owned. It has recently raised $1.5 billion at a $27 billion valuation. The company has a database of 80 million customers. Sports betting will be a new challenge when the time comes.