Market Movers A roundup of some of the North American equities making moves in both directions today
On the rise
Shares of The Stars Group Inc. (TSGI-T) jumped 16.9 per cent in early afternoon trading on Thursday after announcing a long-term deal with FOX Sports, a unit of Fox Corp. (FOXA-Q), after the bell on Wednesday for what they call a "first-of-its kind national media and sports wagering partnership in the United States."
"The Stars Group and FOX Sports expect to launch two products in the Fall of 2019 under the FOX Bet umbrella," they said in a release. "One will be a nationwide free-to-play game, awarding cash prizes to players who correctly predict the outcome of sports games. The second product, which will be named FOX Bet, will give customers in states with regulated betting the opportunity to place real money wagers on the outcome of a wide range of sporting events in accordance with the applicable laws and regulations.
With the commercial agreement of up to 25 years and associated product launches, Fox will acquire 14,352,331 newly issued common shares in The Stars Group, or 4.99 per cent of its issued and outstanding common shares, at a price of $16.4408 per share.
In a research note, Echelon Wealth analyst Gianluca Tucci said: "Preliminary U.S. sports betting market estimates are very lucrative; we believe this announcement represents a watershed moment with a significant partner whom TSGI can leverage as a very low-cost customer acquisition channel as it carefully places a strategic and significant wager on the U.S. market. We believe this is a significant win for both parties as advertising, television, digital content, and wagering all drive user experience and raise the level of engagement. This type of deal furthers our belief that TSGI is rightfully deserving of a premium multiple relative to peers."