Fanatics CEO sheds sports club ownership stakes in nod to forthcoming betting interests

Fanatics CEO Michael Rubin has sold his 10% stake in Harris Blitzer Sports Entertainment (HBSE) as part of measures necessitated by the firm’s forthcoming and long-awaited launch of its sports betting platform.

HBSE owns NBA franchise the Philadelphia 76ers as well as NHL side the New Jersey Devils, and, as such, Rubin’s ownership of a stake in the business conflicted with league rules concerning owners interests.

It is understood the move has been in the works for some time, something alluded to by Rubin in a statement confirming the sale published on Twitter.

“As our Fanatics business has grown, so too have the obstacles I have to navigate to ensure our new businesses don’t conflict with my responsibilities as part-owner of the Sixers,” he said.

“With the launch of our trading cards and collectibles business earlier this year which will have individual contracts with thousands of athletes globally, and a soon-to-launch sports betting operation, these new businesses will directly conflict with the ownership rules of sports leagues,” Rubin added.

HBSE co-founder Josh Harris hailed the contribution of Rubin to the business, suggesting the transition of Fanatics into a global business had made the sale something of an inevitability.

“I am so grateful for his years of partnership. His fierce passion, entrepreneurial mindset, and steadfast commitment to doing the right thing have left an indelible mark on the Sixers organization,” Harris said.

“Michael will always be a member of our HBSE and Sixers family, continue to be a presence courtside, and a key partner in our collective commitment to be a force for good in Philadelphia,” he added.

Fanatics has made slow but steady progress to becoming a sportsbook operator over the last 12 months, moves that began with the recruitment of FanDuel CEO Matt King in May 2021.

The sports merchandizer has built on this initial recruitment by creating its own betting and gaming division, kicking off a massive recruitment drive, and later filing patent applications for online casino and sportsbook apps.

However, the firm’s journey into sports betting has not all been plain sailing, with Fanatics being rejected for a sports betting license by the New York State Gaming Commission in November 2021, despite a bid proposal which featured Roc-Nation founder and rap legend Jay-Z as one of its supporters.

In February, Rubin scotched reports that Fanatics would springboard its sportsbook goals through M&A of a US-based sportsbook, suggesting there were no candidates of interest on its radar.

The firm has been linked with the purchase of platform technology and coding from sportsbook supplier Amelco, but these reports have yet to be confirmed.

Last month, Fanatics made moves to trademark the BetFanatics brand with the US Patent and Trademark Office.