The Stars Group Inc. (NASDAQ:TSG) shares got a kick Thursday after the company reported a deal with FOX Sports.
The Los Angeles-based company announced plans to launch FOX Bet, the first-of-its kind national media and sports wagering partnership in the United States. The Stars Group and FOX Sports have entered a long-term commercial agreement through which FOX Sports will provide The Stars Group with an exclusive license to use certain FOX Sports trademarks.
The Stars Group and FOX Sports expect to launch two products in the Fall of 2019 under the FOX Bet umbrella. One will be a nationwide free-to-play game, awarding cash prizes to players who correctly predict the outcome of sports games.
The second product, which will be named FOX Bet, will give customers in states with regulated betting the opportunity to place real money wagers on the outcome of a wide range of sporting events in accordance with the applicable laws and regulations.
In addition to the commercial agreement of up to 25 years and associated product launches, Fox Corporation will acquire 14,352,331 newly issued common shares in The Stars Group, representing 4.99% of The Stars Group's issued and outstanding common shares, at a price of $16.4408 per share, the prevailing market price leading up to the commencement of exclusive negotiations.
CEO Rafi Ashkenazi said: "We believe this strategic partnership uniquely positions us to build a leading betting business in the U.S., which represents one of the most exciting long-term growth opportunities for our company."
Shares rocketed $2.80, or 16%, to $20.29 approaching noon EDT Thursday.
