Shareholders at an EGM voted in favour of proposals to distribute sale proceeds and the majority of corporate cash reserves. The money will be distributed in two tranches following the completion of the US$225m sale, which was agreed in June.
Melbourne-headquartered PointsBet said the first tranche of approximately AU$315m will be distributed soon after the initial completion. That is expected to come in mid-September.
The second capital return is expected to be between AU$125m and AU$143m and is intended to be implemented soon after the subsequent completion. This is anticipated to be around March 2024.
PointsBet said in a statement: “Following the sale of the US business, the funding requirements of the company’s remaining assets will be fundamentally different to the status quo.
“Accordingly, PointsBet intends to distribute to shareholders the net sale proceeds (after applicable taxes and transaction costs) together with the majority of the company’s corporate cash reserves that will be surplus to the needs of the remaining business.”
US accounted for 50% of revenue
The US accounted for around 50% of PointsBet’s revenue and 40% of total net win during the first half of 2023. US operations contributed $1.6bn of the group’s total $3.2bn in the six months to 31 December 2022.
PointsBet said earlier this year that its Australian and Canadian businesses would be around break-even on a stand-alone basis.
PointsBet agreed to sell its US operation to Fanatics after the sports retail giant outbid DraftKings.
Fanatics’ FBG initially reached an agreement with PointsBet for its US business in May for $150.0m. However, in June, DraftKings submitted a higher proposal worth $195.0m. PointsBet said it would engage with DraftKings over what it said could be a “superior” proposal.
Upon confirmation of the improved FBG offer, DraftKings announced that it would no longer pursue a deal.