PointsBet Hires Bank Group To Lead The Sale Of Its North Americans Assets

PointsBet sportsbook hired investment bank Moelis & Company to lead the sale of its American business operations.
 
The development comes after it was reported that PointsBet had been speaking to Moelis & Co. last week regarding the liquidation of its North American enterprise. PointsBet is based in Australia and has enjoyed far more success regionally than it has in the booming NA industry.
 
PointsBet had been in talks with Australian company Betr (not to be confused with micro-betting platform Betr, co-founded by Jake Paul) in late-2022 but was unable to reach a sale. It now hits the open market as the seventh-largest legal sports betting outfit in the states.

Initiating the sale process confirms the rumors that were swirling last week and in the preceding weeks.

PointsBet posted $120m in revenue in the back half of 2022, a 28% year-to-year increase. It also handled over $1.1bn in bets during the first half of the fiscal year 2023, but despite that, it was unable to claim a decent-sized share of a market dominated by FanDuel, DraftKings, BetMGM, and Caesars sportsbooks.

The dominance of these four, and especially FanDuel and DraftKings, has led to many smaller businesses viewing consolidation as an unavoidable reality. 

“We believe further industry consolidation is inevitable,” a PointsBet spokesperson previously told The Australian Financial Review.

No early suitors have emerged in the newly-opened sale process. Fanatics, which launched its sportsbook near the turn of the year, was said to hold an interest in acquiring PointsBet last year but had not made any contact with the Australian bookmaker.

Fanatics already made headway by teaming up with the Washington Commanders to erect the first retail sportsbook inside of an NFL stadium, FedEx Field in Landover, Maryland. A previous NFL policy mandated that any sportsbooks inside stadiums be closed during home game days, but that rule was amended to give game-attending fans the chance to utilize the new attraction.

There is expected to be even more interest from companies beyond the likes of Fanatics that are looking to add to their sports betting portfolio. Bally’s, for example, has been aggressive in the acquisition market in years past, though it has prioritized reducing costs recently and even undergone a massive wave of layoffs.

PointsBet is currently live in 14 states, including sports betting giants such as New York, New Jersey, and Ohio. 

It applied for an operator’s license in Massachusetts, which launched retail sports betting on January and online sports betting on March 10 but withdrew its request to help save money. 

Despite still being a prominent player in the world of sports wagering, PointsBet had also been put through a run of recent controversy because of its affiliation with the University of Colorado. The school received $11.6 million upfront and an additional $30 for every customer that created an account using its affiliate code.

Colorado, already a large school in the Pac-12, was put into the center of the national spotlight when Deion “Coach Prime” Sanders accepted a job as head football coach late last year, leading to an immediate uptick in sales, visibility, and attention.

The American Gaming Association released an update that said partnerships between sports betting companies and colleges and universities would be impermissible unless they were for the purpose to promote safe and responsible gambling. PointsBet and Colorado “amicably” and mutually ended their partnership in the aftermath. 

Most sports bettors are looking at the NBA and NHL playoffs, as well as the NFL draft. In a couple of months, the only major American sport that will be on TV is baseball. It won’t be until college football and the NFL return in the fall that sportsbooks pick get back to their highest levels of participation.