Apollo Global Management is reportedly contemplating merging Yahoo Sports with a sports betting company. The US private equity firm bought Yahoo as part of a $5bn deal with Verizon last year.
preliminary discussions with numerous betting companies
CNBC reported on Wednesday that Apollo is holding preliminary discussions with numerous betting companies, including Australia-based PointsBet. Sources remained anonymous due to the nature of the private discussions. They stated that the talks are at an early stage, with no deal imminent.
PointsBet’s current market valuation is about AU$1.15bn (US$840m). Its share price jumped 18% following news of discussions.
Spokespeople from Apollo, PointsBet, and Yahoo did not comment on the speculation. However, sources believe that the resulting entity from a merger would likely still use Yahoo branding.
The potential of a deal
The Yahoo brand is not a stranger to the gambling space. It was one of the first fantasy sports platform providers and also has a marketing partnership with BetMGM formed in October 2019. This deal allows BetMGM to provide its odds for relevant Yahoo Sports content. It is not clear what would happen to this multi-year agreement if a betting merger went ahead.
Meanwhile, PointsBet is one of the smaller sportsbooks in the US battling with the giants of FanDuel and DraftKings for market share. The brand has gained market exposure through a five-year partnership with the NBC broadcast network. The deal, signed in 2020, gave NBCUniversal a 4.99% stake in PointsBet in return for exposure across its media network.
An interest in gambling
Apollo already has numerous other gambling-related interests. Just last month, it closed its acquisition of the Venetian Resort Las Vegas and the Venetian Expo in a deal worth $2.25bn. Apollo has also purchased Great Canadian Gaming for $1.96bn and Italian gaming operator Gamenet for about $1.2bn over the past couple of years.
failing to take over the non-US assets of William Hill
The company has also pursued acquisitions with less success. Apollo made an unsuccessful $2.92bn bid for various aspects of Australian gambling giant Tabcorp’s business last year, as well as failing to take over the non-US assets of William Hill despite making a bid in September 2020.
Outside of gaming, Apollo has expressed a desire to grow Verizon’s various media businesses. In addition to Yahoo Sports, this includes Yahoo Finance, Engadget, and TechCrunch.