Fanduels top executive said Wednesday the entertainment giant is buying a majority share of HBO, an investment that could boost the company’s value and help make it more competitive with other streaming-video companies.
The deal is valued at $3.2 billion, the person familiar with the matter said.
HBO is expected to report quarterly earnings on Wednesday, though the financial details of the deal were not immediately available.
The person also spoke on condition of anonymity because the transaction is private.
In recent months, HBO has been pushing to grow its content business, and its stock has rallied in recent weeks.
In February, the company announced it would pay $3 a month to stream movies and TV shows from streaming-TV services, including Amazon and Netflix.
The company’s shares rose about 1% in after hours trading Wednesday.
Fandus Chief Executive Officer Marc Benioff said in a statement that the transaction with HBO will provide us with a stronger platform for the future and will further strengthen the Fandufund and HBO brands.
“We believe this transaction will help us better position ourselves for the upcoming next-generation of our business,” Beniof said.
The announcement comes on the heels of HBO’s announcement in February that it would begin offering premium channels in a move to lure fans of HBO and other premium programming to its streaming-tv services.
HBO has said it is looking to bring in as many as 10 million new subscribers over the next few years.
BenioFowlss comments come as the stock has lost some of its value over the past week.
It lost almost 3% in premarket trading Thursday, before recovering slightly to close at $1.33.
The stock was down 0.4% in the after hours.
The move to buy HBO comes as Fanduaf has been battling a series of acquisitions and strategic changes in recent years, and it has been losing money.
Fincen, a company that specializes in making entertainment content, is a major shareholder in Fandue, which is owned by Fanducn.
Benidoff, a veteran of the movie and television industry, will step down as CEO of Fanduzion next year.
He had been the companys chairman and CEO since 2015.
F&F, which also owns Fandule, has not commented on the transaction.