Stake.com Quietly Acquires Stake of PointsBet
The owners of crypto online casino Stake.com have made a bold move in acquiring a sizable stake in ASX-listed sportsbook PointsBet. The company made the move to try and establish a legal presence in Australia.
Stake.com Acquires Stake into PointsBet
Last year, Stake.com owners Ed Craven and Bijan Tehrani shared plans to diversify and get a stake in the Australian betting market. Those plans finally came to fruition as it was revealed last week that the pair had acquired a 4.2 per cent stake in PointsBet.
TopAustralianGambling has learned that the pair spent the last months acquiring shares through EasyGo Gaming, a company owned and operated by the pair. It is unknown at this time whether the 4.2 per cent stake is the limit they wish to acquire. What is clear is that the pair are willing to invest in more established forms of gambling.
Stake.com is a cryptocurrency casino operating in Melbourne and licensed through the Curacao Gaming Control Board. However, Australian law prohibits the company from offering online gambling services to Aussies.
Tehrani had stated last year that the company was seeking an Australian wagering license. Craven and Tehrani intended to apply for a license through the Northern Territory Racing Commission. They were then looking to register companies in Australia and operate under the Stake Gaming brand. However, this move was quickly met with a legal challenge as a stock trading platform already shares the name.
Initially launched in 2017, Stake.com has become one of the world’s top Bitcoin and crypto casinos. They process hundreds of billions of real money bets on online casino games, online pokies, table games, and sports. The company is best known for signing Drake last year as a brand ambassador. The company operates under the Kick brand in some countries and has sponsorships with the Everton Football Club of the English Premier League and Alfa Romeo’s F1 team.
PointsBet Looking to Recover After Failed American Venture
PointsBet is an Aussie-based sportsbook headquartered in Melbourne. The company is looking to increase its market share and primarily focuses on Australia after selling its US business to Fanatics earlier in the year for $343.2 million.
PointsBet was looking to capitalize on the growing American sports betting market and was even the official sports betting partner of NBC Sports. However, the company underestimated the competition, and the value of the business suffered.
However, the company is on a path to profitability. In a shareholder meeting in July, CEO Sam Swanell told shareholders that the company would be profitable in 2024 once Fanatics completed its acquisition. “Our Australian operation has a strategically important place in the Australian wagering market,” Swanell told shareholders last month. “We intend to continue to grow our online share … from a solid 5 per cent position.”
Will PointsBet Help Stake.com Get Licensed?
The PointsBet acquisition could prove beneficial in multiple ways. First, it gives the owners of Stake.com some exposure in the regulated market in a form that should prove relatively low-risk. If the company can find a way to profitability, the move could net the owners extra revenue that could be reinvested into potential Australian expansion.
Next, with Stake.com looking to become licensed, the PointsBet stake could be a way for the company to prove that it can comply with regulatory standards. The company has thus far adhered to laws by excluding Australians from Stake.com’s platform. If they can prove to be a reputable part of PointsBet, this could give regulators the confidence to approve licensing.
At this time, it is still being determined whether Stake.com will move above its initial stake. Under regulations, Stake cannot hold more than 10% of the company. A reasonable stake of around 9.9% would give the company sensible exposure while helping PointsBet work its way back into profitability.
