Apollo seeking potential Yahoo Sports merger with sportsbook operator
Global private equity firm reportedly in early-stage talks with PointsBet Holdings and others
Apollo Global Management, the global private equity firm that counts Yahoo among its assets, is reportedly seeking to merge Yahoo Sports with an established sports betting operator as part of a spin-off plan.
Apollo, which acquired Yahoo from Verizon for $5bn in 2021, is reportedly in early-stage talks with multiple operators, including PointsBet Holdings. The Australia-based betting company is valued at $760m and currently live in 10 US states.
PointsBet has long been rumored as a potential M&A target thanks to a strong product offering and full ownership of its tech stack. Its lack of brand equity, however, has hindered its ability to carve out a significant share of the US market.
Those characteristics could make for a potentially good fit with Yahoo, as Apollo would likely want to leverage a sportsbook’s digital infrastructure and fold the operation into the Yahoo Sports brand.
There could be some roadblocks, though, as both PointsBet and Yahoo have standing partnerships in the space.
PointsBet linked up with NBCUniversal in 2020 in a five-year deal highlighted by NBCU receiving a 4.99% equity stake in PointsBet, which in turn committed nearly $400m in marketing spend over the life of the deal.
It subsequently signed NFL legend and NBC analyst Drew Brees to a content and ambassador deal in 2021.
Yahoo, meanwhile, has an existing agreement with BetMGM – the joint venture between Entain and MGM Resorts – whereby it funnels users to BetMGM through its fantasy and sports databases.
Talks between Apollo and PointsBet are reportedly early and no merger is imminent, with both firms declining to comment on the speculation. But other sports betting executives have weighed in, including Entain CEO Jette Nygaard-Andersen.
In Entain’s most recent earnings call, Nygaard-Andersen didn’t appear moved by the rumor, deeming it “old news” and underscoring that BetMGM’s partnership with Yahoo Sports is merely affiliate driven.
Rush Street Interactive (RSI) CEO Richard Schwartz addressed the topic in his own earnings call, emphasizing the value an established media partner can bring in terms of brand awareness and acquisition – two areas in which RSI has struggled in many states.
“Yahoo has been in the business for a long time and has some great assets,” Schwartz said.