The largest acquisition in Better Collective history, the deal will combine two of the market leaders in generating tools for bettors to inform their wagers. The transaction includes $12 million in new Better Collective shares, to be distributed among Action Network management and executives, according to a news release.
The Action Network’s business has grown significantly in the past year, as sports gambling has spread across the U.S. and the pandemic brought about a sharp uptick in wagers. The company, backed by the Chernin Group, is on pace for nearly $40 million in revenue in 2021, more than double its 2020 total.
The acquisition will speed up Better Collective’s expansion in the U.S. The Denmark-based company said it now expects its own U.S. revenue to surpass $100 million by 2022. It also raised its overall revenue and profit projections for fiscal 2021.
The acquisition “gives us a leading position within affiliation in the U.S. and a strong foundation for profiting from the continuous regulation of the U.S. betting market,” Better Collective CEO Jesper Søgaard said in a statement. “We add three new, very well-positioned U.S. sports media brands to our portfolio and welcome around 100 new colleagues, together representing an invaluable pool of knowledge and expertise on the U.S. sports betting media market.”
This is the latest acquisition in U.S. sports betting and media, a white-hot corner of the entertainment industry. Sports gambling companies, like DraftKings, are increasingly moving into the media world, and media companies are increasingly encroaching on gambling. In the background, operators are spending hundreds of millions to acquire new customers as each new state legalizes sports betting.
The Action Network, which launched in 2018, plays a role in that economy. The company’s main revenue driver is affiliate fees—money it gets for referring new customers to sportsbooks—plus various subscription products centered around news and data.
The Action Network will continue to operate as a separate business unit with its current leadership and management team in place. That includes CEO Patrick Keane, who will report to Better Collective U.S. CEO Marc Pederson.
The transaction is expected to close in the second quarter. Morgan Stanley acted as a financial adviser to Better Collective; Moelis & Co. acted as financial adviser to Action Network.
More from Sportico.com