Fox Corporation is on the verge of acquiring an 18.6% stake in FanDuel at a discounted price of $2.2 billion. This opportunity arose after the company sold its position in the Stars Group to Flutter Entertainment in 2020. The potential acquisition was discussed by Fox Corporation CEO Lachlan Murdoch at a conference, where he estimated the stake to be valued at $6.5 billion in the current market. However, Fox will only have to pay approximately $4.3 billion for the stake, thanks to an arbitration ruling in 2022 that set the purchase price at $3.7 billion, with a 5% annual increase. The deadline for Fox to exercise this option is by 2030.
Despite the promising opportunity, one obstacle for Fox Corporation is the need to obtain gaming operator licenses to finalize the transaction. Murdoch confirmed that the company is actively working with regulators in various states to secure the necessary approvals. This move signifies Fox Corporation’s reentry into the US sports betting sector, following the closure of its previous venture, Fox Bet, due to profitability challenges.
FanDuel currently stands as one of the top players in the US online sports betting market, alongside DraftKings. The competition between these two companies has been fierce, with both vying for market share and customer engagement. Fox Corporation’s potential investment in FanDuel could significantly impact the landscape of the industry and strengthen its position within the market.
The strategic move by Fox Corporation to acquire a stake in FanDuel reflects its commitment to tapping into the lucrative online gambling market. With the rapid growth of online sports betting in the US, fueled by the legalization of gambling in various states, companies like FanDuel and DraftKings have seen substantial success. By aligning itself with a leading player in the industry, Fox Corporation aims to capitalize on this trend and leverage FanDuel’s expertise and market presence.
The partnership between Fox Corporation and FanDuel could also open up new opportunities for collaboration and synergies between the two entities. With Fox’s extensive media reach and FanDuel’s strong presence in the online gambling sector, the partnership could lead to innovative marketing strategies, content integration, and cross-promotional campaigns. This collaboration has the potential to drive growth for both companies and enhance their competitive edge in the market.
Overall, Fox Corporation’s potential acquisition of a stake in FanDuel marks a significant step in its strategic expansion into the online gambling industry. The move not only positions Fox as a key player in the rapidly growing market but also sets the stage for future partnerships and synergies that could drive further growth and success for both companies. As the online sports betting sector continues to evolve and expand, partnerships and investments like this one will play a crucial role in shaping the future of the industry.