FOX Sports is teaming with the Stars Group to launch a sports betting network titled FOX Bet which will be offered in states and jurisdictions were sports betting is legal.
The Stars Group already has market access in 13 states for sports betting. The companies hope to launch the site by August in time for the NFL season.
FOX Sports will provide the Stars Group with an exclusive license to use certain FOX Sports trademarks and will invest $236 million to acquire 5 percent of the group. CNBC has also reported that FOX will have an option to acquire half of the group’s U.S. interests after 10 years.
Under the partnership, the Stars Group and FOX Sports expect to launch two products in the Fall of 2019 under the FOX Bet umbrella. One will be a nationwide free-to-play game, awarding cash prizes to players who correctly predict the outcome of sports games.
The second product, which will be named FOX Bet, will give customers in states with regulated betting the opportunity to place real money wagers on the outcome of a wide range of sporting events in accordance with the applicable laws and regulations, the companies said in a press release.
As part of the deal, Fox Corporation will acquire about 5 percent of the Stars Group through newly issued shares at a price of $16.44 per share.
The Stars Group will use the money—estimated at $236 million—for general corporate purposes and to pay down debt.
“We believe this strategic partnership uniquely positions us to build a leading betting business in the U.S., which represents one of the most exciting long-term growth opportunities for our company,” said Rafi Ashkenazi, chief executive officer of the Stars Group. “Leveraging our proven media partnership strategy with Sky Sports in the UK, we are excited to partner with FOX Sports to integrate wagering into sports media and drive customer acquisition and retention in the U.S.”
Under the commercial agreement, FOX Sports will grant to the Stars Group an exclusive license for the use of certain FOX Sports trademarks for a range of immersive games and online sports wagering, and certain exclusive advertising and editorial integration rights on certain FOX Sports broadcast media and digital assets.
As part of the transaction, FOX Sports will receive certain brand license, integration and affiliate fees. In addition, during the term of the commercial agreement, the Stars Group has agreed to a minimum annual advertising commitment on certain FOX media assets, the release said.
