FanDuel owner Flutter Entertainment has made its U.S.-facing brand the nation’s highest-grossing sportsbook by revenue. It may soon have to sell nearly 20% of its most lucrative asset.
- Fox holds an option to acquire 18.6% of FanDuel at a fixed price, creating a significant overhang on Flutter’s valuation and strategy.
- The option’s value depends on FanDuel’s growth, with current market conditions making execution unlikely but future upside potentially attractive.
- Rising prediction markets and declining Flutter stock add pressure, complicating both FanDuel’s outlook and Fox’s decision.
Fox maintains the right to purchase 18.6% of FanDuel as part of Flutter’s 2019 acquisition of The Stars Group. Fox must acquire all 18.6% in a single transaction and can execute that move at any point until December 2030.
Since Flutter acquired FanDuel in May 2018, the U.S.-based company has grown to generate nearly half of the company’s global revenues. FanDuel’s rapid growth in the North American market has also been a major driver of the company’s overall valuation as Flutter’s existing major markets, including Ireland and the U.K., have slowed in recent years.
Fox acquiring nearly 20% of FanDuel would equate to as much as 10% of Flutter’s overall value.
If executed, it could also have a significant impact on not just Flutter’s finances but its corporate operations, the company reiterated in a recent corporate document.
“In the event that Fox exercises the Fox Option, we would be required to sell to Fox a significant minority stake in our FanDuel business,” the company wrote in its 2025 10-K filing. “If at that point Fox’s consent is required for certain actions we wish to take and we are unable to obtain it, we may not be able to pursue elements of our business strategy.”
In the meantime, it remains a lingering and potentially significant unknown for the company’s short- and long-term future. “Fox” is mentioned 109 times in Flutter’s most recent 10-K document, compared to 110 for “sportsbook.”
Potential Fox actions
After a 2023 arbitration agreement between the two companies, Fox can buy the 18.6% for a set price. That figure was $4.8 billion as of the end of 2025, with the cost rising 5% each year Fox doesn’t take the option.
For Fox, the fixed price (with the annual increase) means it is likely pulling for FanDuel’s growth. If FanDuel’s value declines, as it has for the past 12 months, Fox can simply not execute the option.
Flutter has a market cap of roughly $20 billion as of April 2026, the same value the company had when the arbitrator made the value ruling in 2023. At this current price point, Fox would actually have a break-even or even a negative direct net payoff from executing the option, making such a deal unlikely at present.
But growth is still handicapped by Fox's option. As FanDuel’s valuation rises above the option’s strike price, a portion of that upside is effectively allocated to Fox.
Six weeks. One billion dollars. One stock down 51%.
— System Signal (@DC_Portfolio) March 13, 2026
Kenneth Bryan Dart. Flutter Entertainment $FLUT.
Week 1: $89M. Week 2: $122M. Week 3: $135M. Week 4: $176M. Week 5: $271M. Week 6: $246M.
Cumulative: $1.04 billion. Into a stock that has halved this year. pic.twitter.com/LizEIt2XVp
If Flutter can grow beyond the 5% mandated cost increase in the coming years, the deal becomes more enticing. Flutter’s market cap was around $50 billion in April 2025; an executed Fox option at that level would be worth nearly double Fox’s cost.
The deal would also require Fox to earn gaming licenses in the more than two-dozen states FanDuel offers its sportsbook, online casino, and daily fantasy sports platform. Fox previously branded the Fox Bet sportsbook in conjunction with The Stars Group before shuttering the platform, which had less than 1% U.S. nationwide market share, in 2023.
It’s unclear what relationship a potential Fox stake in FanDuel would have with the company’s sports broadcasting properties. FanDuel rival DraftKings is a sponsor and betting odds provider for ESPN.
Prediction markets weigh on decision
Few stocks have been hurt more by prediction market growth than that of the nation’s leading sportsbook operator.
Since reaching an all-time high in September 2025, Flutter's stock has fallen by roughly two-thirds. In the meantime, prediction markets have seen their trading volume, largely driven by sports event contracts, grow every month.
FanDuel and DraftKings have responded with their own prediction markets. Flutter said it expects to invest several hundred million dollars on its platform in the coming year.
It remains to be seen if that can turn around the company’s prospects in the eyes of investors. While the legality of prediction market sports event contracts, which make up more than 80% of the major platforms' trading volume, has not yet been finalized by the courts, they are still drawing hundreds of millions of dollars in investments.
Kalshi and Polymarket both have valuations of around $20 billion, roughly the same as Flutter and nearly twice as much as DraftKings.
Fox is surely weighing FanDuel’s foray into prediction markets among the many factors it considers before potentially executing its ownership options. But as Flutter fights the upstart prediction market platforms on one front, it remains subject to a potentially seismic shift in ownership structure.
