PrizePicks gains CFTC approval, amidst new announcement

The fantasy sports company PrizePicks has officially been approved as a futures commission merchant, which could open the doors to the prediction markets.

It’s ‘Performance Predictions II LLC’ that won the approval, with this being an entity under the PrizePicks umbrella. On the official NFA website, the company is NFA Member Approved and CFTC registered as a Futures Commission Merchant.

This comes after the PrizePicks company released major news on Monday (September 22) that the lottery-led gaming entertainment company Allwyn International AG would acquire a majority stake in PrizePicks.

The duo entered into a definitive agreement this week, with Allwyn agreeing to purchase an approximately 62.3% stake in PrizePicks for an expected initial cash consideration of $1.6 billion, implying an upfront enterprise value of $2.5 billion.

The agreement continues to suggest that if the daily fantasy sports operator achieves certain performance metrics over the next three years, an additional cash consideration under the agreement could raise the implied enterprise value to a maximum of $4.15 billion.

PrizePicks will operate as a standalone brand within Allwyn

In the announcement, the transaction has been described as a ‘unique opportunity to enter the strategically important sports and entertainment industry in the United States’ for Allwyn. It also means it can expand its business in the country beyond its existing operation of the Illinois Lottery.

Karel Komarek, Allwyn Founder and Chair, said: “This acquisition will continue to drive Allwyn’s momentum and expand our business in the United States. PrizePicks has established its credentials as an industry pioneer, revolutionising the way fans engage with the athletes they love, making the contests more thrilling and immersive. We are excited to work with PrizePicks to shape the future of this new frontier in casual entertainment.”

Going forward, PrizePicks will operate as a standalone brand within Allwyn and will be led by its CEO Mike Ybarra and the existing leadership team who will be retaining the majority of their existing ownership interest.

Mike Ybarra, CEO of PrizePicks, said: “Today marks the start of an exciting new chapter for PrizePicks and our growing community of players. There has never been a more electrifying time to shape the future of fan-first entertainment.

“By joining forces with Allwyn, a like-minded and disruptive company that shares our passion for bold product innovation, we will accelerate our mission to make our games more interactive, engaging and rewarding for fans everywhere.”

The post PrizePicks gains CFTC approval, amidst new announcement appeared first on ReadWrite.

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