PointsBet, one of the leaders of the Australian-based sports wagering operators, agreed to sell its operations in 15 US states to global sports betting corporation Fanatics for $225 million (approx $150 million US). As The Australian Financial Review reports, the deal expecting shareholder and regulatory approval comes after PointsBet’s failure to achieve the target market share in the US jurisdictions regardless of comprehensive promotional campaigns and activities.
Strong Competition:
The ASX-listed company agreed it could no longer compete in the market. PointsBet chief executive Sam Swanell reportedly said: “You had a situation [in 2018] where pretty much every online betting company in the world targeted that market. It is expensive, the cost of doing business there because it’s a state-by-state market. You need scale.”
The decision follows a series of partnerships in the North American market that have recently been terminated, such as those with odds provider NBC Sports and the University of Colorado testifying about the difficulties the company has experienced during its North American expansion. According to the source, the wagering company was ranked as the seventh-largest sportsbook in the US.
Preserving Capital:
Fanatics, a Florida-based $46.5 billion commercial, trading, and sports betting giant, was reportedly chosen as the buyer for it offered a favorable transaction structure, Swanell told the Australian Financial Review and added that Point’sBet was forecast to lose up to $123 million until the end of this year. The company advised by Moelis & Co and Flagstaff Partners will have the losses cut down to $ 21 million by the completion of the transaction.
”When you think about the deal, you’ve got to think about it in terms of the headline price, but also the fact that we’re preserving the capital that we have on the balance sheet,” Swanell reportedly said. “Pretty much, Fanatics takes over the investment into the US business, bar $US21 million, which we’ve agreed to sort of cover as part of the swings and roundabouts.”
Returning Cash to Shareholders:
The sales deal includes some profitable arrangements which were the result of the total of approximately $ 240 million Point’sBet investments into promotion and marketing. As the expensive excursion is now over, Swanell reportedly said: “The cash that we have on the balance sheet, the excess surplus corporate cash, plus obviously the proceeds from the transaction … the aim is to distribute that to shareholders.”
Bottom Line:
The operator will focus on its Australian and Canadian businesses and merge them into the entity PointsBet’s RemainCo which will, according to Swanelll be “break even” on an EBIDTA basis within 12 months after the termination of US business. “The market has somewhat stagnated in Australia because there’s been some headwinds, but we’re clearly growing our market share,” Swanell reportedly said. “We think we can put the foot down and keep going.”
As the source reports, Point’sBet Australian operations have been on sale for more than a year now. The company rejected a $220 million offer from Betr last June, looking for a more favorable opportunity. Swanell reportedly said: “I think the bottom line is always what creates the most value for our shareholders.”
The legal status of online casinos in India is complex and varies by state. While there is no federal law that explicitly addresses online gambling, the legality depends on state regulations and the type of gambling involved.
Key Points:
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No National Law: India does not have a specific national law regulating online casinos. However, the Public Gambling Act of 1867 prohibits operating physical casinos and gambling houses, but it doesn't cover online platforms, leaving a legal grey area for online gambling.
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State-Specific Laws: Some Indian states, like Goa, Sikkim, and Daman, have legalized land-based casinos, and others, such as Sikkim, have also licensed online gambling. Many states have banned gambling altogether, including online gambling.
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Online Sports Betting: Betting on sports, particularly cricket, is very popular in India. However, it's only explicitly legal in some states like Sikkim and Nagaland, which have laws permitting online gaming and betting.
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Legal Gray Area: Many international online casinos accept Indian players and operate legally under licenses from offshore jurisdictions (like Curacao or the UK Gambling Commission). As long as players are gambling on licensed platforms, the risk is minimal, but local authorities may still choose to regulate or restrict online gambling.
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Cryptocurrency: Some Indian players prefer using cryptocurrencies (like Bitcoin) for online gambling, as it provides a layer of anonymity and security.
While online casinos aren't explicitly legal across all of India, many international casinos accept Indian players, and online gambling continues to grow in popularity. Players should ensure they use licensed platforms and understand local laws before engaging in online gaming.
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