Reports Say PointsBet Is Considering Selling Its U.S. Operations

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  • PointsBet reportedly spoke with an investment bank about a sale
  • PointsBet saw an increase in revenue and losses recently
  • Bally’s could be interested in acquiring PointsBet’s American operations

PointsBet sportsbook is reportedly taking the next step towards selling off its North American operations.

The company is said to have spoken with global investment bank Moelis & Co. to discuss how it would go about removing its presence in the USA and Canada. The company has blossomed in Australia, where it was founded, but has struggled to make a breakthrough in the highly-competitive NA region.

The wheels on a sale have not been put in motion, but the report suggests that PointsBet is inching closer to relinquishing its jurisdiction in the area.

Problems in the new market

Sports betting in North America, especially the USA, is dominated by FanDuel, DraftKings, BetMGM, and Caesars. Smaller operators have popped up in numerous states, but almost all have had trouble making significant headway.

As a result, there has been speculation that many smaller operators could consolidate their businesses. This was recently confirmed by a PointsBet spokesperson.

“We believe further industry consolidation is inevitable, and we’ll position PointsBet to take advantage of movement in the sector,” the spokesperson said to The Australian Financial Review.

PointsBet reported a 28% year-to-year increase in its half-year results ending on December 31, 2022, but the net loss was still 21.7% above where it was the year prior. A majority of those losses are attributed to its exploits in the USA.

PointsBet joined the American market in Kansas and Louisaiana in September 2022. It has since expanded to a total of 14 states.

The sportsbook is unique compared to the other dominant powers in the gambling industry because of its betting options. One unique feature it has is “points betting,” which turns game units into financial units.

For example, if a bettor wagers $5 that Team A will cover the spread of five points, and Team A actually wins by 25 points, they will win $100 (25-5 x $5). That model introduces variability that is not available in traditional sports betting and offers a chance at profits that most other sportsbooks require massively-unlikely parlays or straight bets to deliver.

It also offered a unique sign-up bonus which gave new bettors the chance to win back money from missed first bets every day for a five-day period. Other sportsbooks offering that “win back missed first bets” deal only made them applicable to the very first bet on the customer’s first day of use.

Exploring the potential sale

One company that has been rumored to have been interested in acquiring PointsBet’s American share is Bally’s, a casino company that operates an internal sportsbook.

Despite finding success in the casino world, Bally’s has also struggled to pry bettors away from other larger sportsbooks, leading to a small market share and increasing losses.

Bally’s has shown repeated interest and commitment to growing in sports betting through acquisitions in the past but recently announced a staff layoff to help focus on the goal of profitability.

Part of PointsBet’s appeal is that it has operational approval in major states such as New York, New Jersey, Illinois, and Ohio. New York is the country’s leader in online sports betting, while the other three are not far off the impressive totals posted by the Big Apple. Ohio also recently joined the American legal sports betting market and has shown real room for growth despite a hot start.

Sports betting as a whole is about to enter a semi-down period by virtue of the sports available. The Super Bowl and March Madness already happened, and once the NBA playoffs finish playing out over the next couple of months, there are no major sports events in America until late fall.

As a result, struggling companies will likely come on harder times over the next few months, thus making it an important time to monitor PointsBet’s movements.

Grant is a sports and sports betting journalist who prides himself in his up-to-the-minute reporting on the latest events in the industry. A member of Virginia Tech’s 2021 graduating class, he has quickly put together an impressive portfolio since moving to the professional world full-time. Grant’s favorite sports to cover are basketball and both types of football (American and soccer), and he is pushing written, audio, and video content. He has been employed by companies as highly regarded as Forbes and continues on a great trajectory in the industry. When he’s not on the clock, you can find Grant at the gym, looking for adventures, or hanging out with his family.