Rapper Jay-Z purchased 25 per cent of Fanatics with other rappers including Meek Mill and Maverick Carter in 2022.

Rapper Jay-Z purchased 25 per cent of Fanatics with other rappers including Meek Mill and Maverick Carter in 2022.Credit:Paul Rovere

US wagering websiteSports Handlereported a deal was close to being completed on Friday. PointsBet declined to comment as the negotiations have not been finalised.

If the deal goes ahead,Fanatics will take over PointsBet’s capital requirements and its two-year advertising deal with NBC,worth $500 million in 2020.

One source who was not authorised to speak publicly said the surplus cash from the sale is expected to be distributed to shareholders upon completion.

PointsBet has been at the centre of local industry consolidation rumours for the past year,and rejected two takeover attempts from News Corp’s joint-venture Betr and preliminary interest from other local operators including Entain and Tabcorp.

PointsBet entered into exclusivetalks with Betr at the end of last year but the Matt Tripp-led group was unable to secure the $250 million PointsBet was seeking for the deal. PointsBet publicly confirmed it was no longer entertaining talks with Betr in a market update last month.

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PointsBet is expected to face additional local acquisition attempts from local wagerers after the sale of its US division is completed.

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Fanatics launched with much fanfare with its star-studded backers in January but is yet to reach its growth target of operating in 15 states by the end of 2023. PointsBet’s early US growth makes it a ripe acquisition target for Fanatics and would see it reach its growth targets upon completion.

Fanatics completed a $US700 million ($1.05 billion) capital raising that valued the company at about $US31 billion ($46.6 billion) last year.

If the deal goes ahead,it will mark the first meaningful acquisition ahead of the long-expected market consolidation in the US.

PointsBet holds about 6 per cent market share in Illinois but hovers at around 2.5 per cent in other states,a fall from its more bullish positions in 2021.

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