DraftKings Considering Taking Over Bleacher Report
DraftKings was founded as a daily fantasy sports operator in 2012, but the company has experienced significant growth over the past few years. Earlier this year, DraftKings became a publicly-traded company, and now it appears that it is set to grow again.
According to industry sources, DraftKings is considering an attempt to take over Bleacher Report. Bleacher Report is owned by the Turner Sports organization, and Turner has been adamant that Bleacher Report is not for sale.
Bleacher Report airs shows from Caesars Palace in Las Vegas, and they provide sports content on all of the major sports in the United States. Turner Broadcasting System purchased the company for $175 million in 2012.
Even though Bleacher Report is under the Turner Sports Group, they are ultimately an entity of AT&T. AT&T purchased the Time Warner Company in 2018 for a whopping price of $108 billion.
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The move was huge for AT&T at the time, but it also carried some huge debt, and now the company is looking to sell some assets in an effort to repay. According to reports, AT&T currently has debt of more than $164 billion, and investors are pressuring the company to sell off some of its valuable assets.
Earlier reports claimed that AT&T was looking to sell DirecTV, which the company purchased for $67 billion in 2015. AT&T management has agreed to and is committed to selling $10 billion in assets this year, but they have not provided any information about which assets they are willing to move.
Bleacher Report could be one of these assets, but AT&T would be looking for a very good deal before moving on.
DraftKings has a policy of not commenting on market speculation, and industry sources have not been able to get a clear answer from the company. DraftKings has been extremely aggressive in recent years when it comes to acquiring other companies, and this deal would make a ton of sense.
DraftKings had one of their best days on the stock market on Tuesday, as their price rose more than 14 percent throughout the day. It was the best single-day performance since they joined the market on April 24.
Even though DraftKings is not yet making a profit as a publicly-traded company, the rising stock prices would give the company some financial flexibility. Adding Bleacher Report to their portfolio would increase their value, and would, in turn, bring about higher stock market prices.
Even though it is unclear what DraftKings would ultimately do if they purchased Bleacher Report, this has become a trend in recent months. Sports betting companies have been acquiring sports media properties to provide some additional content to their bettors, and more content on their site.
Penn National Gaming recently bought a 36 percent stake in Barstool Sports. Penn National Gaming paid a whopping $163 million for the 36 percent, but it could lead to the company eventually owning Barstool Sports entirely.
Barstool quickly emerged as a leader in the sports media industry, and they have locations throughout the country.
William Hill quickly followed the acquisition of Penn National Gaming by partnering with CBSSports.com. The Penn National/Barstool Sports deal has been used as a template for these kinds of partnerships since that time. If DraftKings was looking to purchase Bleacher Report, it would use the same model.
Bleacher Report provides content that caters to a younger demographic, and they have a huge following throughout the company. Bleacher Report could be used to produce content that appears on the DraftKings Sportsbook site if this deal does go through.