Disney Now Owns Stake in DraftKings

Date Created: May 22
Written by Jerico

USA - Many people all over the world are aware that the Walt Disney Company has recently acquired 21st Century Fox. But what people may not know is that their acquisition of Fox came with a few perks, one of which is that they now have a stake as well in DraftKings, a sports betting and daily fantasy sports company.

It was in 2015 when Fox purchased a $300 million stake in DraftKings, and Disney now owns that stake after it closed its $71.3 billion acquisition deal with Rupert Murdoch at the end of March. DraftKings itself confirmed this news to Legal Sports Report, saying: “Disney now owns, through one of its subsidiaries, the prior Fox interest in DraftKings as part of the purchase by Disney of Fox.”

Apparently, the betting company is not going the same route as Fox Sports Networks, which Disney has recently sold to Sinclair Broadcasting. Part of the terms of the Fox acquisition was that Disney had to divest the regional sports networks. No such term applies to the DraftKings stake, and it certainly looks like Disney has decided to hold on to that stake.

What makes this development interesting is the fact that Disney has always stood against gambling in the past. There was even a time when the company funded opposition to a proposed amendment that sought to open up sports betting in the state of Florida. And just this February, Disney CEO Bob Iger said: “I don’t see Disney, certainly in the near term, getting involved in the business of gambling, in effect, by facilitating gambling in any way.”

Iger went on to say: “I do think that there’s plenty of room, and ESPN has done some of this already and they may do more to provide information in coverage of sports that would be relevant to and of particular interest to gambling. But getting into the business of gambling, I rather doubt it.”

ESPN is also owned by Disney, and they have recently come to an agreement with Caesars that seeks to put a sports betting studio in a Las Vegas Linq hotel. Despite this update, however, there is no indication that Disney intends to push DraftKings. It may be worth noting that DraftKings only has full operations in New Jersey at present. Disney may not be so keen to invest in the company further, considering its lack of a global or even a national footprint.

According to Iger: “We’ve already done some things that would integrate it into our programming, but not to the extent that we would be facilitating gambling as an entity. In other words, we’ll provide programming that will, I guess, be designed to enlighten people who are betting on sports. But that’s as far as we would go.”

Whether Disney will change its mind and start actively investing in its DraftKings stake remains to be seen. For now, it does seem like they’re sticking to their general opposition of gambling and will not go beyond educating consumers and reporting the news where gambling is concerned.