NBA and MLB Looking To Ditch Equity In DFS Operators DraftKings and FanDuel
There is a lot of scrambling going on ahead of the possible legalization of sports betting in the U.S. With a decision expected anytime now from the Supreme Court it is clear that major sporting bodies like the NBA and MLB are positioning themselves to be ready to take advantage of a multi-billion dollar market that could legally open up.
We have reported recently that the major sports leagues are indeed in favor of legalizing sports betting but want a percentage of the profits which is highly contentious. Many are quick to criticize these bodies for worrying more about getting a piece of the pie than maintaining the integrity of the game which has always been their stated objection as to why sports betting should not be legalized on a federal level.
In an interesting development it seems that both the MLB and NBA will be selling their equity in DraftKings and FanDuel in an attempt to avoid public criticisms of their potential vested interest in the legalization of sports betting.
In a report from ESPN’s Darren Rovell it was bandied about that both leagues have indeed started discussions to ditch their equity positions in DraftKings but will remain partners with DraftKings.
MLB have reportedly held equity in DraftKings dating back from 2013 and the NBA took an equity position in FanDuel from 2014. The NHL is also reportedly an equity holder in DraftKings.
The report comes at a time that DraftKings has openly confirmed their plans to create a sports betting product which will be ready to launch following a legal ruling allowing it to do so. With the major leagues lobbying for legalization on their terms they just have to avoid giving the obvious impression they they are players and not equity stakeholders in companies that would directly benefit from legalization.