PointsBet Holdings Ltd (ASX: PBH) shares are on the move this morning after the company provided some acquisition news. In early trade, the PointsBet share price is trading 3.54% higher at $14.04.
Let's take a closer look at the company's news.
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What's driving the PointsBet share price?
The PointsBet share price is responding positively after the company revealed it is acquiring United States-based account wagering provider Premier Turf Club for US$2.9 million. Premier Turf Club is an active pari-mutuel Advance Deposit Wagering (ADW) operator with a license to operate in Oregon. The company provides legal telephone and online betting services, handling over $375 million in wagers through its online platform since 2007.
Pari-mutuel betting, also known as pool betting, takes a different spin on the traditional customer vs. bookmaker style of betting. Instead of going against the bookmaker, customers are placing wagers against other bettors who have placed wagers on the same event. All wagers go into a pool, and the pool is shared equally between those who win. A small percentage of total wagers is deducted for the house.
PointsBet believes Premier Turf Club's extensive industry expertise and relationships, customer-focused operations, and excellent reputation will be of immediate value for the company and its growth aspirations in the United States.
The racing industry in the US generates more than US$12 billion in turnover annually. PointsBet aims to be at the centre of innovation and premium products within the US horse racing market. The addition of Premier Turf Club adds to the company's growing portfolio of proprietary wagering products which already includes its fixed-odds sportsbook and online casino.
Management commentary
PointsBet USA CEO Johnny Aitken commented on the acquisition, saying:
The combination of Premier Turf Club's excellence in the space with PointsBet's mature market Australian racing expertise favourably positions us as we prepare to enter the U.S. horseracing market. Today's noteworthy acquisition complements our inhouse approach while growing our premier product suite, and we are excited to welcome Premier Turf Club to the PointsBet team."
PointsBet share price snapshot
The PointsBet share price is currently trading around 19% higher in 2021 and has also climbed by 231% over the past 12 months. Based on its current valuation, PointsBet has a market capitalisation of around $2.5 billion.
