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SportsTranscript
00:00All right, let's get started here and you know, once upon a time when sports betting
00:06became illegal, the first company to really be out in the forefront with it, not Vandal,
00:11not DraftKings.
00:12It was actually FoxBet because Fox NFL Sunday popped up and it was like, boom, here, here's
00:17where you can bet, FoxBet.
00:20You know, mixed results there.
00:21I would say probably didn't work out, but boy, Fox had, you know, a card in their pocket
00:26that they're pulling out here.
00:27I didn't even realize this, that they had the option to purchase a piece of FanDuel.
00:32Tell us more about that.
00:34Good move by them.
00:36Great move by them.
00:37What happened, Craig, was that Flutter bought a company called the Stars Group and the Stars
00:43Group was the company that partnered with Fox to run FoxBet, which just an aside, FoxBet
00:48only closed a year ago.
00:51It feels like it happened so much longer ago to me than just a year.
00:56So that is mostly why FoxBet wound up dying because Flutter owned FanDuel, stronger brand,
01:02and so they just kind of did what they had to with FoxBet and then they came to the agreement
01:07last year that it was cut off.
01:08But Fox does have this agreement to buy an 18.6% stake in FanDuel and it's been in court
01:15for a little while and things were messy because of this.
01:19Part of it is the reason why we have Flutter listed in the US and not FanDuel because Fox
01:25would have to give their approval toward any IPO moving forward.
01:30Now Lachlan Murdoch, the CEO of Fox, said that they will be acting on this at an analyst
01:36conference last week.
01:38The main reason is because right now it will cost Fox about $4.3 billion to buy that stake.
01:48The stake has FanDuel valued at $20 million and there was arguments over that too.
01:56Fox wanted to pay it $11 billion and then FanDuel a couple years ago was saying, well,
02:01we're worth like $30 million.
02:03So they came in at $20 million.
02:06The estimate for FanDuel now though is it's worth about $35 billion as a standalone, not
02:12as part of Flutter.
02:14So that puts that 18.6% stake at about $6.5 billion.
02:19So Lachlan Murdoch came out and said, well, there's no way we're going to miss out on
02:23$2 billion on the table.
02:25That is essentially what it comes down to.
02:28They have this.
02:29And he said, by the way, we think it's going to keep growing.
02:32The tricky part about this, Craig, is that with a stake that big, anything over 5%, you
02:37have to be licensed in the gaming world.
02:41And so Fox, Lachlan said that they have started with these gaming licenses and the deal cannot
02:47go through until then.
02:49Now, luckily they have plenty of time, 2030 is when the deal would expire, the option
02:54would expire.
02:55So they will be able to do it at some point, but we don't know how long that'll take.
03:01It seems like the licensing process can move quickly in some of these new states with how
03:05fast the apps get up.
03:07But a lot of the states work off of temporary licenses and it'll say something in the law
03:12to the effect of, well, if you already operate in five or more U.S. states, we can just assume
03:19that you're okay.
03:20We'll give you that temporary license, we'll check the very, you know, bare minimum things,
03:24and then we'll do a deeper dive into you.
03:26And Fox isn't going to have that luxury.
03:28So it'll take a little while to get them licensed.
03:33The other part of it is he said, look, we love sports betting to interact with sports
03:39fans.
03:40You know, I mean, they own half the NFL every weekend, right?
03:46And then if they get a stake in FanDuel, they'll just be even more incentivized.
03:50So it's going to be interesting to see how this goes.
03:53I always expected Fox to go through with this option because, again, FanDuel has just been
03:58on a rocket ever since sports betting started.
04:03But to hear that it is actually going to happen and that the licensing is through is definitely
04:06big news.