PointsBet inks deal with NBC Sports and outlines AUS$300m capital raise

The Australian sportsbook operator has inked a major deal with NBC sports.

The Australian sportsbook operator, PointsBet, has agreed a deal to become the official sports betting partner of NBC Sports and outlined plans to raise an additional AUS$300m (£165.1m) in capital.

The NBC Sports deal

The deal between PointsBet and NBC Sports will run for five years and PointsBet has committed to a marketing spend of US$393m under the deal.

PointsBet will become an official partner of the NBC Sports Predictor and integrate its content throughout the application, providing more games for users.

The deal will also facilitate the integration of exclusive PointsBet odds into Rotoworld, NBC Sports’ fantasy and sports betting digital property. PointsBet will also be integrated with NBC Sports’ Golfnow brand.

The Australian sportsbook will become the exclusive provider of odds, props and trends for NBCSN and Golf Channel and their digital properties, as well as NBC Sports Podcasts and Peacock, NBCUniversal’s new streaming service.

PointsBet managing director and group chief executive Sam Swanell said: “Through the NBC Sports partnership, PointsBet gains access to market-leading linear assets which span 184m viewers and digital assets which span 60m monthly active users.

“These assets will act as the cornerstone of our marketing strategy and combined with our in-house technology and products, as well as our talented and experienced team, will deliver outstanding client acquisition and retention efficiency as we scale rapidly over the next five years.”

The deal will also see NBC Universal, NBC Sports’ parent company, be issued with new fully paid ordinary shares in PointsBet, representing a 4.9% ownership interest in the operator and 66.9m options which will mature in the next five years.

PointsBet said this would offset the $393m marketing spend and reduce the cash commitment over the five-year deal.

The 66.9m stock options will be exercisable at AUS$13 per stock option and the agreed value will amount to AUS$105.3m. At any time before the options expire, NBC can elect to receive the full value of the stock options.

David Preschlack, president NBC Sports Regional Networks, and executive vice president of content strategy at NBC Sports Group, said: “For NBCUniversal and PointsBet, this agreement provides considerable opportunities in the fast-growing sports betting marketplace, which is unique to this extensive and robust, multi-year arrangement.

“Looking ahead, we’re also excited about the significant activation opportunities that will come to fruition as sports betting continues to proliferate across the US.”

What the NBC deal means for PointsBet and the US betting space

At face value, the deal will provide PointsBet with an opportunity to capture a greater market share in the US sports betting space, or at the least, help the operators compete with DraftKings, FanDuel, BetMGM and other competitors.

The Australian sportsbook also plans to launch in more states including Colorado and Illinois. Unlike its main competitors, PointsBet has not yet secured entry into Pennsylvania’s sports betting market. However, the operator plans to expand its online casino offering in New Jersey as well as launch in Michigan.

While this deal will give the operator a fighting chance to compete with the likes of FanDuel and DraftKings, PointsBet will still need to stay on the offensive. Currently, DraftKings and FanDuel combined hold about two-thirds of online US sports betting market. These operators also have databases of daily fantasy customers in states that have yet to launch sports betting.

Other gambling and media deals

This marks the latest deal between a gambling entity and a media organization in the US.

At the time of writing, Yahoo and BetMGM, the product of the joint venture between GVC Holdings and MGM Resorts International, are engaged in a partnership. CBS Sports and William Hill are also working together, as are ESPN and Caesars Entertainment.

Penn National Gaming is also working with Barstool Sports to capitalize on the evolving US sports betting space.

Plans to raise AUS$300m in capital

PointsBet also outlined plans to generate an additional AUS$300m via a capital raising, with plans to begin the process on 2 September.

The offer price will be determined when the process begins later this week. However, it is predicted that the entitlement offer ration will be one new share for every 6.5 shares held on the date of launch.

Stock options are likely to have an exercise price of AUS$13 each and will be exercisable until the expiry date which is currently 30 September 2022.

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