DraftKings is trying to quash sports merchandising company Fanatics first effort to get into the market of online sports betting — or at least make it more expensive.
Fanatics founder and chief executive Michael Rubin has been openly seeking to break into the lucrative sports betting market and got started last month with a $150 million deal for the US unit of Australian betting firm PointsBet. The unit has about a 3 percent US market share and has been losing tens of millions of dollars, analysts said.
But on Friday, DraftKings swooped in and offered to one-up the offer with a $195 million all-cash bid.
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“We believe DraftKings is uniquely positioned to submit this superior proposal due to our scale and corresponding ability to generate meaningful synergies from the acquisition,” DraftKings chief executive Jason Robins said in a statement.
DraftKings already offers sports betting online and via its mobile app in 23 states, including Massachusetts. It ranked second nationally in the market trailing only Fanduel and well ahead of BetMGM, Caesars, and Barstool Sportsbook.
PointsBet has been eager to shed its money-losing US operation and was seeking bids in the range of $1 billion a year ago when the market was hot.
“DraftKings is looking to be opportunistic,” analyst Robert Fishman at MoffettNathanson wrote in a report on Friday. The bid also “can be viewed as a defensive move that at the very least would delay Fanatics’ closing and possibly cause an increase to their own $150 million proposal.”
PointsBet on Friday said its board of directors would evaluate the DraftKings offer. “The directors of PointsBet are committed to acting in the best interest of all shareholders and are considering the DraftKings proposal alongside its advisers,” the company said in a statement. “Subject to the outcome of the review being undertaken of the DraftKings proposal, the board continues to recommend that shareholders vote in favor of the [Fanatics] transaction.”
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Fanatics chief executive Michael Rubin dismissed the offer. “We are skeptical of the DraftKings proposal which seems like a desperate move to slow down Fanatics and PointsBet from completing the deal,” he said in a statement.
Shares of DraftKings, which have more than doubled already this year, lost 1 percent on Friday.
Aaron Pressman can be reached at aaron.pressman@globe.com. Follow him on Twitter @ampressman.