One day after Fanatics CEO Michael Rubin said he was selling his ownership stake in sports teams to clear the way for sports betting market entry, CNBC reported his company is in talks to acquire German sports betting operator Tipico.
Tipico is owned by international private equity firm CVC Capital Partners, with headquarters in Malta. It is one of the largest sports betting groups in Germany, and also has operations in Austria, Croatia, Gibraltar, Colombia, and the United States, where it has licenses in New Jersey and Colorado, online market access in Iowa and Indiana through an agreement with Caesars Entertainment, and ongoing plans for upcoming Ohio market.
The cited news outlet reported Thursday that a deal has not yet been reached, and the two sides are currently at an impasse on price, though talks are ongoing, citing two people familiar with the matter who asked not to be named because the discussions are private.
Rubin said Wednesday he is selling his 10% stake in Harris Blitzer Sports and Entertainment (HBSE), which owns the NBA’s Philadelphia 76ers and the NHL’s New Jersey Devils, citing a conflict of interest with Fanatics’ collectibles and planned sports betting operations. His move paves the way for Fanatics to enter the sports wagering and NFTs business landscape, since under league ownership rules, Rubin couldn’t own part of a team and operate a gambling platform at the same time.
Fanatics is a $27 billion company —up from $4.5 billion in 2017— that sells licensed professional and college merchandise online, with more than 10,000 employees in 57 countries and with 100 million users, according to Rubin. Fanatics’ growth has been partly fueled by its acquisitions in recent years of WinCraft, which makes sports-themed merchandise, and Topps, the trading card company it bought for $500 million.
“We can be the No. 1 player in the world in that business in 10 years,” Rubin told Sports Business Journal earlier this year. “That does seem ambitious for someone who’s not in the business today, but our strategic advantages are that we are one of the best-known digital sports brands and we touch so many fans.”
Back in January, Major League Soccer (MLS)’s franchise Columbus Crew announced Tipico as the official and exclusive Sports Betting Partner of the team. Tipico said at the time it plans to launch its mobile sports betting app when legalized sports betting goes live in Ohio, which is scheduled for January 1, 2023.
Moreover, in August last year, Tipico partnered with Colorado Governor Jared Polis to announce the opening of a Tipico technology hub in Denver. In July 2021, the company kicked off a partnership marking Tipico as the exclusive sports betting and iGaming provider for Gannett, with deep local and national integration and exposure across the entire USA Today and USA Today Sports Media Network.