Posted: March 3, 2022, 7:46 a.m.
Last update: March 3, 2022, 7:46 a.m.
Investors are fanatical about Fanatics as they pumped $1.5 billion into the sporting goods maker, valuing the aspiring games company at $27 billion.
The latest funding round for Michael Rubin’s private company included existing investors as well as BlackRock, Fidelity and MSD Partners – an investment vehicle controlled by Dell founder Michael Dell. At the implied valuation of $27 billion, this indicates that Fanatics is worth 50% more today than it was less than a year ago.
As the company’s valuation rises, so does speculation regarding an initial public offering (IPO). Fanatics have previously expressed interest in an IPO, calling such a move likely, but the timing of that deal has not been disclosed.
If the company were to announce an IPO in 2022, it would almost certainly be one of the biggest of that year – regardless of the sector – and would likely represent a significant monetization opportunity for major investors, including the private equity firm. Silver Lake and SoftBank investment.
The gaming ambitions of fanatics
It’s well known that Fanatics is looking to branch out from its core sporting apparel and merchandise business and some of those efforts include a possible move into the gaming world.
Last year, the company filed several patent applications with the United States Patent and Trademark Office (USPTO) for a branded casino, mobile betting application and sports betting. Previously, the Florida-based company announced the hiring of former FanDuel CEO Matt King and Tucker Kain, the former president of the Los Angeles Dodgers business enterprise.
Fanatics has also been linked to an assortment of gaming industry takeover rumours, including speculation that it has had merger talks with Rush Street Interactive (NYSE:RSI) and Swedish gaming giant Betsson. Last year.
The company was also seen as a potential suitor for TwinSpires – controlled by Churchill Downs. Fanatics was rumored to have held discussions with Australian PointsBet (OTC: PBTHF) before deciding against a takeover of this operator. PointsBet remains a hotbed of takeover chatter.
Fanatics have other businesses
Beyond apparel and merchandise and its gaming aspirations, Fanatics has other businesses, including its Candy Digital unit – a non-fungible token (NFT) with the right to produce digital art related to some professional sports leagues.
Additionally, Rubin’s company announced in January that it was paying $500 million to acquire trading card giant Topps Sports & Entertainment.
This purchase is complementary for Fanatics because last August the company acquired the rights for card deals with Major League Baseball (MLB) and the NBA. Fanatics Trading Cards landed $350 million in funding from three investors last September, valuing the business at $10.4 billion, reports The Wall Street Journal.