IG Group to Acquire US Prediction Markets Firm Underdog for $1.1 Billion

IG Group’s $1.1 Billion Play for Underdog

IG Group has agreed to acquire the US sports and prediction markets company Underdog in a transaction valued at $1.1 billion, or approximately £810 million.

The agreement marks a major expansion for the FTSE 100-listed firm into sports gaming and event-based prediction markets across the United States. Completion of the deal remains subject to standard regulatory and antitrust approvals, with leadership targeting a final close in late 2026 or early 2027.

Deepening North American Footprint and Revenue Projections

For IG Group, the purchase is designed to significantly deepen its operational footprint in the North American market.

Corporate projections indicate that the combined business will generate roughly 40% of its total revenue from the US following the integration, a substantial jump from the 22% contribution currently recorded. The deal structure includes up to $200 million in earnout payments tied directly to Underdog’s financial performance through 2026, alongside a separate management incentive plan worth up to $850 million contingent on hitting specific EBITDA targets in 2028 and 2029.

Daily Fantasy Sports and the New Exchange

Underdog built its reputation primarily as a daily fantasy sports operator before expanding its product suite.

Recently, the company launched its own prediction markets exchange, which permits users to trade contracts on athletic fixtures alongside external markets covering politics, financial indicators, cryptocurrencies, and cultural events. Financial disclosures show that Underdog generated $466 million in net revenue during the 12 months leading up to June 2026. The platform currently counts more than 11 million registered users, a total that includes over five million active customers who have made financial deposits.

Securing Critical US Regulatory Licences

A primary driver for IG Group behind the acquisition is obtaining Underdog’s specialized regulatory licence stack.

The purchase grants IG Group access to critical approvals from federal authorities, including futures commission merchant (FCM), designated contract market (DCM), and derivatives clearing organisation (DCO) licences. These regulatory permissions allow the company to independently list, clear, and manage its own financial and event-based contracts within the United States.

Leadership Perspectives on Convergence

Jeremy Levine, co-founder and chief executive officer of Underdog, pointed to the company’s structural flexibility in a public statement regarding the agreement.

“We built Underdog by creating the best experience for fans, and we’ve proven we can build the best products no matter how the regulatory landscape shifts,” Levine said. “It’s why we’ve taken off in prediction markets since we launched last year.” He added that joining forces with IG Group will allow the platform to accelerate its product offerings for users looking to make predictions on sports and other major public events.

Breon Corcoran, chief executive officer of IG Group, emphasized the broader technological shifts driving the acquisition. “Technology is reshaping the large, high-engagement markets in which IG operates – and increasingly bringing them together,” Corcoran noted. He described Underdog as a product-first team that provides a leading daily fantasy sports franchise coupled with the necessary regulatory infrastructure to establish a distinct position in the competitive US prediction markets sector.

Antitrust Review and Closing Timeline

While daily fantasy sports continues to anchor the bulk of Underdog’s commercial operations, the rapid scaling of its prediction markets exchange has altered its trajectory.

As regulatory bodies examine the transaction over the coming months, both companies will continue operating independently until the final closing conditions are met. Stakeholders and market observers await further regulatory filings detailing the antitrust review timeline ahead of the anticipated late 2026 or early 2027 completion date.