Fanatics is rooted in the sports merchandise market and has plenty of connections in the sports industry. That network is going to play an important role as the company embarks on its next big venture. According to Darren Rovell, writing for The Action Network, Fanatics could soon become the owner of an established sports betting operator, with a deal “expected to close soon.”
Fanatics to Become a Sportsbook Operator
Gaining access to the sports betting market has been a goal of Fanatics for some time; however, it was met with a certain amount of skepticism over the company’s lack of experience. This led the company to seek an established sportsbook for a potential purchase and two names came up. Rovell indicated in a piece from yesterday that Fanatics is talking to Rush Street Interactive (RSI) and Betsson in “productive” conversations to purchase one of the two companies’ sports betting operations.
RSI, asserts Rovell, would be a good target. The company is active in ten states, but isn’t one of the industry’s heaviest hitters. That would facilitate a name change to Fanatics that would mostly fly under the radar. It could also be an expensive arrangement, as RSI is reportedly considering ESPN’s offer to purchase the latter’s name for around $3 billion. Betsson, on the other hand, is a longer reach since it doesn’t currently have any established sports betting operations in the US.
Fanatics Moves Up in the Ranks
Fanatics may have been a leader in the sports merchandise market, but always had its eyes on something bigger. It started to bring in industry veterans to fill key positions to achieve its goals, and the efforts are paying off. Fanatics added former FanDuel CEO Matt King to its ranks this past June, giving him the reins to head up a new sports betting and gaming division. That same month, it tapped Ari Borod, the former chief operating officer (COO) of The Action Network, to be its COO. The moves found support from investors, who quickly jumped on a funding round in August that led to the company being valued at $18 billion.
That valuation was also made possible due to a massive coup by Fanatics. Last month, in a shocking turn of events, the company broke the hold Topps had on the MLB trading card market. The league ended its 70-year relationship with the incumbent in favor of Fanatics, which will also hold the rights to NBA and NFL cards. The transition will take place at the end of next year, setting the stage for Fanatics to take over. With that new contract in hand, the company has serious leverage to find investors willing to back the purchase of a sportsbook.