Fox Mulls Tabcorp Takeover to Boost Sports Betting Profile
Posted on: March 18, 2021, 11:55h.
Last updated on: June 23, 2021, 01:22h.
Rupert Murdoch’s Fox Corp. (NASDAQ:FOXA) is reportedly mulling a bid for Australia’s Tabcorp as an avenue for increasing its sports wagering exposure.
The media giant is said to be working with an unidentified US investment firm on an offer for Tabcorp’s betting and media businesses. Fox also registered for an Australian trademark for its FOXBet brand, stoking speculation the company is aiming to become a major player in one of the world’s most mature and biggest sports betting markets.
It started speaking to local wagering companies about potential ways to bring its business onto local shores,” reports The Sydney Morning Herald, citing unidentified sources.
Fox, which is currently run by Lachlan Murdoch, Rupert’s son, has deep ties to Australia. But its potential overture for Tabcorp is about much more than a sentimental relationship. It’s about economics.
While the US is widely regaled as the fastest-growing sports wagering market, the Land Down Under offers its own allure. The Australian Gambling Research Center estimates gamblers there between the ages of 18 to 49 spend almost $775 a month on sports wagering — one of the highest rates in the developed world.
In 2018, Australians spent $16.75 billion on horse racing wagers and $7.18 billion on sports bets, according to the Queensland Treasury.
Fox Faces Competition for Tabcorp
Owing to the combination of the aforementioned statistics and growth opportunities associated with sports wagering, Fox isn’t the only suitor for Tabcorp. Far from it.
Entain Plc (OTC:GMVHY) made an offer for the Australian company last month, as did private equity firm Apollo Global Management (NYSE:APO). Entain is familiar to US investors because the company is MGM Resorts International’s (NYSE:MGM) partner on the BetMGM venture — the third-largest online sports betting operator in the country.
Apollo’s interest in Tabcorp isn’t surprising. It recently acquired the Italian digital gaming, gaming machine, and sports wagering operations of International Game Technology (NYSE:IGT) for $1.15 billion, and is rumored to be interested in William Hill’s international businesses, which Caesars Entertainment will almost certainly sell upon finalizing its takeover.
The private equity company has deep pockets. Including the IGT, acquisition of Great Canadian Gaming Corp. (GCGC), and the recent purchase of the Venetian and Sands Convention Center in Las Vegas, Apollo has spent nearly $6 billion on gaming deals alone in recent months.
Fox Tabcorp Interest Makes Sense
In addition to the aforementioned Aussie betting market economics, Fox potentially making a run at Tabcorp is sensible for other reasons.
The media conglomerate isn’t being shy about its desire to expand its sports wagering presence. It formed its FOXBet unit with The Stars Group (TSG) in 2019 ahead of TSG being sold to Flutter Entertainment (OTC:PDYPY).
Today, Fox is one of the Irish gaming company’s biggest shareholders and owns 18.5 percent of FanDuel, positioning it to benefit if Flutter spins off the largest US online sports betting operator.
Related News Articles
Related News Articles
MGM Resorts Overhauls Las Vegas Table Games PolicyJune 2, 2023 — 6 Comments—
Las Vegas Sands Request for Long Island Tax Breaks Draws IreJune 4, 2023 — 6 Comments—
VEGAS MYTHS BUSTED: Tony Hsieh Saved Downtown Las VegasMay 8, 2023 — 4 Comments—
No comments yet