Dan Loeb Pushes Disney for ESPN Spinoff, Sees Sports Betting Opportunity
Daniel Loeb’s Third Point initiated a new position in Walt Walt Disney (NYSE:DIS) said to follow worth well-nigh $1 1000000000000 and is pushing the companionship to spin-off ESPN — a go that could get it easier for the electronic network to hammer into sports wagering.
In a letter of the alphabet today to Walt Disney CEO Bob Chapek, Loeb, whose hedging fund has previously been an investor inwards the media company, touches on issues beyond a potency breakup of ESPN, including refreshing Disney’s board, integration of the Hulu streaming table service and others. Still, the billionaire investor is keen to insure the sports monster separated from the parent company.
Employees of ESPN could be stipendiary inwards a surety flat tied to their performance,” wrote Loeb inwards the letter. “ESPN would make greater flexibleness to pursue business organization initiatives that may follow to a greater extent difficult as parting of Disney, such as sports betting.”
That seems to imply a pursuance of sports betting by ESPN is topper with the sports broadcaster standing aside from Disney, but the parent companionship doesn’t needfully regard things that way.
In remarks made in later(a) 2021, Chapek said a deeper move past the fellowship into sports wagering isn’t potential to harm its iconic firebrand — i often associated with kinfolk friendliness and compatibility. Rather, a more open connexion with betting could prop upward the ESPN brand.
No Secret About Walt Disney Sports Betting Ambitions
Disney isn’t shy virtually its want to receive more deep mired with sports betting and it sees economic value inwards such a displace for its thriving ESPN+ streaming service.
The sports network has long signaled that fantasize sports and wagering are avenues to bolster the streaming religious service and the network at large. ESPN accelerated its exposure to the sports betting infinite inward September 2020, inking separate, multi-year accords with Caesars Entertainment (NASDAQ:CZR) and DraftKings (NASDAQ:DKNG).
Last year, reports surfaced that ESPN was shopping usage of its extremely recognized make to sportsbook operators inward an effort to solid ground a multi-year business deal valued at least $3 billion, but nix came of that speculation.
For his part, Jacques Loeb sees other compelling reasons why ESPN should live a standalone companionship and some of those are relevant to sports wagering.
“Customers of ESPN and sports leagues would follow ameliorate served by a focused management team impulsive a leading berth inward sports distribution,” wrote the Third Point founder. “We trust that to the highest degree arrangements betwixt the ii companies can buoy live replicated contractually, in the way of life eBay spun PayPal patch continuing to utilize the production to treat payments.”
Disney Long-Running Sports Betting Rumors
Loeb’s letter to Chapek arrived just years after Disney reported fiscal third-quarter earnings. On the ensuing conference call, Chapek acknowledged the company held sports betting conversations with different platforms and a related to promulgation could follow on the way.
He didn’t further elaborate, but he appears to consider time value inward sports betting inward some descriptor and Walt Disney has long been rumored to be a potential a suitor for several sportsbook operators.
“We make found that basically our sports fans that are below 30 utterly require this typewrite of public utility company inward the boilers suit portfolio of what ESPN offers. So we guess it’s important,” addead Chapek on the call. “We’re working firmly on it, and we trust to experience something to foretell inward the time to come inward terms of a partnership thither that will permit us to approach that revenue stream.”