Fox Sports will become the first major U.S. media company to put its brand on a sports betting operator.
Fox Corp., the parent corporation of Fox Sports, announced Wednesday that it has purchased a 4.99 percent stake in online gambling company The Stars Group for approximately $236 million, according to a news release.
The companies plan to launch sports betting app Fox Bet this fall and will begin taking bets in states with regulated mobile sports betting. The Stars Group is operating an online sportsbook in New Jersey and plans to open in Pennsylvania, one of the states that has passed legislation allowing for online wagering.
In addition, the companies will offer a nationwide free-to-play game that will award contestants cash prizes for correctly predicting outcomes of games.
Sports Business Daily and Bloomberg first reported the partnership between Fox Sports and The Stars Group.
"Digital sports wagering represents a growing market opportunity that allows us to diversify our revenue streams, connect directly with consumers and expand the reach of the Fox Sports brand," Eric Shanks, CEO and executive producer of Fox Sports, said in the release announcing the partnership.
Last May, the U.S. Supreme Court struck down the Professional and Amateur Sports Protection Act of 1992, the federal statute that had restricted state-sponsored sports betting to primarily Nevada. Since the Supreme Court's landmark ruling, legal sportsbooks have begun operating in seven states in addition to Nevada: Delaware, Mississippi, New Jersey, New Mexico, Pennsylvania, Rhode Island and West Virginia.
Indiana Gov. Eric Holcomb signed sports betting legislation into law Wednesday, joining Montana as states to authorize sports betting in 2019. Iowa and Tennessee also have advanced sports betting bills and are awaiting action by their respective governors.