The value of individual shares in DraftKings Incorporated reportedly rose by some 9.2% yesterday following news that the American online sportsbetting behemoth may be nearing the completion of a large deal with sports broadcasting giant ESPN Incorporated.
According to a Thursday report from the Bloomberg news service, the Nasdaq-listed operator is looking to further cash in on an American iGaming market that last year chalked up aggregated revenues of approximately $2.65 billion. This growing scene was purportedly inaugurated in the summer of 2018 when the United States Supreme Court invalidated the tenets of the Professional and Amateur Sports Protection Act (PASPA) including one that had limited online sportsbetting to the states of Nevada, Montana, Oregon and Delaware.
DraftKings Incorporated is now reportedly licensed to offer its online sportsbetting entertainment to aficionados in 19 American jurisdictions including the lucrative states of Colorado, Illinois, Michigan and New York alongside the Canadian province of Ontario. Such a presence has purportedly made the company a prime partner for media firms looking to raise money from its attempt to sign up more punters via a range of television marketing campaigns.
However, Bloomberg reported that DraftKings Incorporated had seen its value drop by 42% this year owing to fears that it may be overextended although yesterday’s boost took its market valuation up to as high as $7.2 billion. This topical swell purportedly also came despite no official comment from either firm with the online sportsbetting colossus simply declaring that it has ‘a great and long-standing relationship with ESPN Incorporated.’
ESPN Incorporated, which is majority-owned by The Walt Disney Company, has reportedly already invested in the emerging American sportsbetting market although steering clear of taking actual bets. The broadcaster purportedly moreover airs betting-related shows such as Daily Wager while its website features links to online sportsbooks from the likes of DraftKings Incorporated and Caesars Entertainment Incorporated.
Bloomberg furthermore reported that The Walt Disney Company acquired a stake in DraftKings Incorporated in 2019 via its $71.3 billion purchase of the international television and film assets of Twenty-First Century Fox. This agreement was purportedly carried out despite the former’s ‘wholesome family’ image and its long-standing opposition to gambling, which included the outlay of approximately $5 million four years ago so as to help defeat a measure that would have legalized sports wagering in Florida.
Nevertheless, The Walt Disney Company is reportedly known to have been searching for a major sportsbetting partner for its ESPN unit for more than a year in hopes of bringing in as much as $3 billion. The Chairman for this latter enterprise, Jimmy Pitaro, purportedly last month told Bloomberg that his company is looking to ‘eliminate friction’ for bettors so as to begin ‘serving the sports fan with what they’re expecting.’
Pitaro reportedly stated…
“We know that sports fans are craving not just more sportsbetting content but they’re craving the ability to actually place bets in a seamless fashion from their online digital sports experiences.”