Betting operator PointsBet might soon sell its Australian division to betr in a deal estimated to be in the $200 million – $250 million range. PointsBet reportedly rejected a better bid from the bookie six months ago, but it now seems the Melbourne-based operator is willing to accept a lower offer.
betr was founded by Matthew Tripp of Sportsbet and BetEasy fame, Matthew Davey from Tekkorp Capital, and CEO Andrew Menz. News Corp Australia owns a substantial share in the bookmaker as well as acquiring Texbet while developing the Betr website.
Interestingly, it was The Australian who first reported that PointsBet might sell to betr. The Australian is another asset in the News Corp media empire. So, it is not surprising they broke the news first.
PointsBet to Inform the ASX that Preliminary Discussions Have Begun
Matthew Tripp said in October that they wanted to grow the betr brand “sensibly through mergers and acquisitions.” Tripp also outlined that they would also engage in organic partnerships, and believed that the sportsbook could become “a tier one operator” soon. He also tipped betr to become “the most prominent brand” in Australia in time.
According to The Australian, Melbourne-based PointsBet must issue a statement before trading on the ASXstarts on Wednesday and say that preliminary discussions with betr have begun.
The official corporate announcement stated that PointsBet had opened discussions with the owners of Australian bookmaker betr with the object of discussions being the sale of PointsBet’s Australian trading business. However, the company added that any potential deal would first be assessed “in the context of PointsBet’s global strategy.”
Third Biggest Betting App in the US
If PointsBet were to sell its Australian betting business, it would benefit from additional capital reserves which would help the company expand more aggressively in the US betting market. PointsBet operates in 13 US states and has just gone live in Ohio, immediately after the state launched legal sports betting on 1 January.
PointsBet’s cash reserves were at $440 million in September and CEO Sam Swanell said that the company would pursue an aggressive US expansion. The company’s US revenue increased by 50% year-on-year compared to Q1 FY23 while net earnings doubled compared to Q1 FY22.
According to Swanell, PointsBet is the third biggest betting app in the US market, with only FanDuel and DraftKings ranking ahead of the Australia-based wagering provider.
PointsBet Could Have Accepted a Better Bid Six Months Ago
The report of a deal with betr comes six months after the Murdoch-owned company attempted a failed takeover in June. News Corp reportedly valued PointsBet’s Australian arm between $228 million and $310 million. PointsBet rejected the offer as too low.
However, it now seems that PointsBet is prepared to accept a bid that’s slightly lower than what it initially rejected.
Matthew Tripp has long expressed a desire to launch a new Australian bookmaker and was waiting for the right moment to go live with betr. He attempted a partnership with News Corp in 2020, but the Flutter-Stars Group merger ended any plans.
Almost three years later, Tripp is now running a bookie that is poised to conquer the Australian sports betting market, especially as it is the only Australian sportsbook with direct links to a media giant.
CEO Andrew Menz is sure that the wagering-media partnership is a winning combination too. The betr chief said in October that the model worked “spectacularly well” for Sky BET in the UK and that it supercharges the growth of any company, particularly a start-up.