IG Group, a well-known trading platform, is set to acquire Underdog, a daily fantasy sports (DFS) and prediction markets operator, in a deal that could reach as high as $1.3 billion. This strategic move is spearheaded by Breon Corcoran, the former CEO of Paddy Power/Flutter, who took over as IG Group's CEO in December 2023 after spending time away from the industry since 2018, following his tenure at Paddy Power Betfair (PPB).
In a recent statement, Corcoran emphasized that the acquisition will position IG Group as a significant player in the US prediction markets and will enhance its growth in the retail trading market, which is currently the largest and fastest-growing globally.
The valuation of Underdog stands at $1.1 billion, representing 2.4 times its 12-month revenue, which is reported at $466 million for the period ending in June 2026. This reflects a 21% year-over-year revenue increase. Additionally, an earnout provision allows for a payout of up to $200 million to Underdog's shareholders, contingent upon meeting 2026 net gaming revenue targets and achieving a positive EBITDA for that year.
To finance the acquisition, IG Group secured a bridge facility amounting to $950 million from Barclays Bank PLC and Goldman Sachs. The transaction is anticipated to finalize in late 2026 or early 2027.
Underdog made a name for itself in the prediction markets sector back in September 2025 through a partnership with Crypto.com Derivatives. CEO Jeremy Levine previously stated that the firm plans to launch sports prediction markets across 16 states. "The future of prediction markets is going to be about sports – and no one does sports better than Underdog," Levine remarked at the time.
Notably, Levine has connections to Corcoran, having founded the DFS platform DRAFT, which was sold to PPB for $19 million in 2017, with potential additional compensation bringing the total to $29 million. IG Group's announcement revealed that Corcoran was also an early investor in Underdog.
This acquisition is projected to significantly enhance IG's presence in the US, with expectations to more than double its revenues and increase active customers by over tenfold. IG Group estimates that following the merger, US operations would account for approximately 40% of the group's revenue, with prediction markets and DFS making up around 25% of the combined net trading revenue.
Currently, Underdog operates in 30 states and has achieved considerable traction in the market, now recognized as the second-largest DFS operator by revenue, trailing only PrizePicks. The platform has captured five million depositing customers and has registered over 11 million accounts.
In pursuing its growth trajectory, IG Group noted potential plans to expand into prediction contracts related to cryptocurrencies, financial markets, and macroeconomic events, which would significantly broaden its market scope.
In summary, Underdog will maintain its distinct brand identity post-acquisition, with Levine reporting directly to Corcoran. The merger is expected to yield operational efficiencies through a shared balance sheet, boosting revenue opportunities across both firms' customer bases and facilitating combined regulatory licensing efforts.
