DraftKings Inc DKNG Shares are up nearly 8.5% in after-hours trading on excitement around a major partnership With Walt Disney Co DIS ESPN.
What happened: The agreement will allow ESPN to build on the increasingly popular sports betting segment, reported Bloomberg.
The details of the deal, including its structure, could not be ascertained by Bloomberg, and ESPN declined to comment on the release.
DraftKings said it has a “great, long-standing relationship with ESPN,” but declined to comment on discussions with other companies, according to Bloomberg.
See also: How to buy Disney (DIS) stock
Why it matters: Disney is meant to be purposeful Sports Betting to Revitalize ESPNwhich was struggling with a decline in the number of subscribers.
Disney CEO Bob Chapek said at the time that the betting trend was “consumer-driven, particularly younger consumers who will fill up sports fans over time.”
It was earlier reported that it was an ESPN sports betting app already in the workswith Chapek saying, “We’re working very hard on it.”
Recently ESPN Chairman Jimmy Pitaro said the sports broadcaster wants to eliminate “friction” for bettors, according to Bloomberg.
Disney has been looking for a major sports betting partner for ESPN for more than a year. It’s targeting up to $3 billion for what Bloomberg called an “enhanced deal.”
Price promotion: On Thursday, DraftKings shares rose 8.5% to $17.41 in extended trading after closing 3.95% lower at $16.04. On the same day, Disney shares fell 0.7% to $100.10 in extended trading after closing 0.4% lower in regular hours Data from Benzinga Pro.
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