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

IG Group has agreed to acquire the U.S.-based sports and prediction markets company Underdog in a deal valued at $1.1 billion (£810 million). According to Sport Industry Group, the transaction allows the FTSE 100-listed firm to expand into sports gaming and event-based prediction markets, with the deal expected to close in late 2026 or early 2027 pending regulatory and antitrust approvals.

The acquisition shifts IG Group’s revenue profile toward the United States. The combined business is expected to generate approximately 40% of its revenue from the U.S. market, an increase from the current 22%, according to company data.

Underdog Market Position and Regulatory Assets

Underdog operates as a daily fantasy sports provider and recently launched a prediction markets exchange. This platform enables users to trade contracts on sporting events as well as topics involving finance, cryptocurrencies, politics and cultural events, according to the company.

A primary driver of the acquisition is the transfer of critical regulatory licenses. Underdog holds approvals as a derivatives clearing organisation (DCO), designated contract market (DCM), and futures commission merchant (FCM). These licenses allow IG Group to manage, clear and list its own contracts within the United States.

Underdog reported net revenue of $466 million for the 12 months ending June 2026. The company’s user base exceeds 11 million registered users, with more than five million of those being deposited customers.

Financial Terms and Incentive Structure

The $1.1 billion valuation includes performance-based components. The agreement specifies up to $200 million in earnout payments tied to the financial performance of Underdog in 2026.

Additionally, a management incentive plan valued at up to $850 million is available if the business meets specific EBITDA targets in 2028 and 2029, according to the deal terms.

Executive Perspectives on Market Convergence

Now, with our own exchange and by joining IG, we’re going to take an incredible leap in what we can offer customers and make Underdog the place to make predictions on sports and beyond.

Jeremy Levine, Co-Founder and CEO of Underdog

IG Group CEO Breon Corcoran noted that technology is bringing high-engagement markets together. He described the acquisition as a way to place the firm at the front of that convergence through a product-first team and a full license stack.

Underdog puts us at the front of that convergence: a product-first team, a leading daily fantasy sports franchise and a full licence stack that together give us a differentiated position in US prediction markets.

Breon Corcoran, IG Group Chief Executive