Media giant Fox Corporation (NASDAQ: FOX) estimates its stakes іn Flutter Entertainment (NYSE: FLUT) and FanDuel at nearly $8 billion.
On a Tuesday earnings call, CEO Lachlan Murdoch stated that Fox’s option tо acquire 18.6% оf FanDuel іs highly profitable, with its stake іn Flutter worth over $1 billion.
Fox previously valued FanDuel at $35 billion, making its 18.6% share worth $6.5 billion. Combined with its Flutter stake, Fox’s total investment in the companies is worth $7.6 billion—almost a third of Fox’s market capitalization.
Fox Working Toward Monetizing FanDuel Investment
Fox’s interest in FanDuel stems from Flutter’s 2020 $12.2 billion acquisition of The Stars Group (TSG). Fox had sold Sky Bet to TSG in 2018 for $4.7 billion, securing an equity stake in return.
Despite a long and sometimes turbulent relationship, Fox is working through the licensing process required to exercise its FanDuel option. Murdoch noted that this process, currently ongoing in 26 states, is progressing and should be completed well before the option expires in 2030.
Fox Has Multiple FanDuel Options
Murdoch didn’t specify Fox’s long-term plans for its FanDuel stake but highlighted several potential strategies. Fox could retain its investment as a passive shareholder, deepen its ties with FanDuel and FOX Sports, or gradually sell its stake to generate cash for media operations and acquisitions.
Another possibility is selling all or part of its FanDuel stake back to Flutter. With Fox’s 18.6% stake and Boyd Gaming’s 5%, Flutter currently owns 76.4% of FanDuel and may seek to increase its share.
