Amaya acquires fantasy sports site

MONTREAL • Online gaming company Amaya Inc. is bolstering its entry into fantasy sports betting by acquiring U.S.-based Victiv for an undisclosed price.

The daily be tting site launched last September will be rebranded StarsDraft and will be ready for the upcoming NFL season as well as offering a venue for league soccer play in Europe.

The site will allow players to build a roster of their favourite sports stars and compete for real money. It currently offers payouts up to $15,000.

StarsDraft will initially be launched in select U.S. markets and later be added through Amaya’s PokerStars platform.

Amaya has been testing its own sports betting activities but is moving slowly because the North American market is very small with less than $100 million in industry revenues last year.

“The market still has to mature more for it to appreciate to a size where we would be willing to make any significant investment,” CEO David Baazov said Thursday during a conference call to discuss second-quarter results.

He said Amaya chose Victiv after examining the technology of 12 different companies.

Kevin Wright of Canaccord Genuity said the acquisition of Victiv isn’t surprising, but it settles questions as to whether the company will be ready for the NFL season.

“The daily fantasy sports space in North America has significant potential and we view the PokerStars marketing and operational experience as an investment positive as it builds a presence,” he wrote in a report.

Wright said the potential market is estimated at US$1.2 billion by 2020. Currently DraftKings and FanDuel have about 90 per cent market share, with Yahoo! and CBS launching competing products. PokerStars has roughly one in 10 U.S. adults in its database, which could help it to gain a meaningful foothold in the segment.

Earlier, Amaya said it swung to a $201.4 million profit in the second quarter ended June 30 as it recorded a large gain from the sale of assets since last year’s blockbuster acquisition of PokerStars — an online betting site.

Net income from continuing operations was $14.1 million, compared with an $8.04-million loss in the second quarter of 2014.

Amaya’s revenues grew to $310.6 million.