Michael Rubin may now be the uncontested king of sports merchandise in the United States, but his plans to construct a television and sports-betting empire have recently hit a snag.
This week, the billionaire’s Fanatics sports-licensing company closed a deal to buy the Topps trading card business for $500 million, or less than three times earnings.
Credit Rubin, who had discreetly — some might say ruthlessly — worked out a deal with Major League Baseball and its player’s union to keep their trading-card rights out of the hands of Topps Chairman Michael Eisner.
Insiders told On The Money that Rubin’s reputation for cool, sharp, and successful calculating has just suffered a setback.
Fanatics hopes to be the largest online sports betting provider, purportedly valued at more than $10 billion in a deal backed by Silver Lake and Endeavor last October. However, despite being sure of winning, the company, which has no sports betting license in any state, just lost the contest for a New York license, according to individuals close to Fanatics.
According to two persons familiar with the case, Fanatics was in the bidding to buy PointsBet, an Australian online sports betting company, around a year ago. According to the insider, Rubin viewed the inside of PointsBet’s operations and opted to establish a firm organically rather than buying an operator.
Rubin’s reputation for cool, sharp, and successful calculating has recently taken a hit, according to insiders.
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According to insiders, he also explored buying other sports bookmakers but decided against it.
Fanatics teamed up with rapper Jay-Z and Dave Portnoy’s Barstool Sports to bid for freshly awarded New York online betting licenses in the fall. According to two individuals close to the bidding group, several Fanatics executives believed they were a shoo-in to win with Jay-Z on board.
Instead, Empire State gaming regulators granted licenses to two other groupings, including FanDuel, DraftKings, MGM, Bally’s, Caesars, and PointsBet, which are led by corporations like FanDuel, DraftKings, MGM, Bally’s, and Caesars.
Nonetheless, insiders say Fanatics wants to establish a sportsbook late this year, with the goal of gaining popularity by renting gaming licenses from existing bookies in multiple states in exchange for a cut of the profits.
In a Wednesday interview with The Washington Post, Rubin said, “We believe this is a meaningful long-term opportunity, but we’ll be patient to grow it the proper way over time.”
According to two sources familiar with the matter, the business has expressed interest in purchasing regional sports television networks but has recently passed on buying the stations that Comcast is selling, including a piece of SNY. Sources speculated that Rubin might have opted to leave the Comcast RSNs due to the networks’ dwindling income.
According to a source, fans may instead try to work with Major League Baseball, with whom it is already associated, in the coming years to establish an MLB-controlled direct-to-consumer streaming package, or wait for Sinclair Broadcasting, which owns the most RSNs, to go bankrupt.