Underdog Fantasy, a New York-based sports betting and prediction market platform, has been acquired by the U.K.’s IG Group in a deal valued at up to $2.15 billion. IG Group will pay $1.1 billion upfront, with an additional $200 million in earnouts to Underdog shareholders, plus up to $850 million for eligible employees based on future earnings targets. To unlock the maximum employee payout, Underdog must achieve earnings before interest, taxes, depreciation, and amortization of $400 million in 2028 and $700 million in 2029. IG Group, founded in London in 1974, is currently planning to move its incorporation to Jersey.

This acquisition positions IG Group as a key player in the rapidly growing U.S. prediction markets, a space where Underdog holds the third-largest market share behind Kalshi and Polymarket. With more than one million average monthly active users and over five million depositors, Underdog’s platform has become one of the top contenders in the industry. IG’s CEO Breon Corcoran highlighted that the deal not only establishes IG's leadership in the U.S. prediction market but also significantly magnifies its retail trading presence in the largest and fastest-growing market.

The acquisition follows a transformative year for Underdog, which recently pivoted away from traditional sports betting and daily fantasy contests to prioritize prediction markets. Earlier in the year, the company cut over 20% of its workforce and acquired Aristotle Exchange’s DCM and DCO arms, which are regulated by the Commodity Futures Trading Commission. This move allowed Underdog to internalize its prediction-market infrastructure and expand its product offerings under a more controlled regulatory framework.

Despite the acquisition, Underdog will continue to operate independently under its own brand and management, remaining part of IG Group’s broader portfolio. CEO Jeremy Levine expressed optimism about the company's potential growth with IG’s resources and reach. IG projects that adding Underdog will more than double its U.S. revenues and increase monthly active customers by more than ten times, underscoring strong confidence in the platform’s future within the prediction market sector.