IG Group’s $1.1bn Underdog deal chases US prediction bets

The deal pays 2.4 times Underdog’s net revenue & includes an earn-out of up to $200m tied to 2026 results.

The hit

IG Group’s proposed takeover of Underdog would more than double its US revenue & lift US monthly active customers more than tenfold, chief financial officer Clifford Abrahams told a shareholder seminar. Underdog, which grew net revenue from $9m in 2021 to $441m in 2025, now runs a full prediction-markets exchange called UDX.

Why it matters

For traders, the deal shows a listed UK spread-betting firm chasing growth in a market whose legal status is still unsettled. Underdog CEO Jeremy Levine said the firm’s three US derivatives licences mean it can operate whether sports contracts stay under federal oversight or revert to state-regulated daily fantasy sports. IG chief executive Breon Corcoran said he personally believes the eventual market could end up a hybrid model, possibly involving local taxation, though he stressed the Supreme Court will decide the legal outcome.

The record

Deal value	$1.1bn upfront enterprise value for 100% of Underdog (IG Group)
Underdog Q3 revenue	$105m, up 118% year on year (Underdog)
Deposited customers	More than 5.5m (Underdog)
Earn-out	Up to $200m tied to 2026 revenue (IG Group)
Deal structure	60% of equity value in 24.1m new IG shares, 40% cash via bridge facility (IG Group)
Deal announced	End of July 2026 (IG Group)

What happens next

Underdog’s management incentive plan depends on EBITDA targets in 2028 & 2029. IG will give a strategy update on its existing businesses on 22 October, & Levine said Underdog expects the US Supreme Court to largely resolve the sector’s regulatory framework next year.

Sources: IG Group’s Underdog Deal Targets U.S. Prediction Markets Growth

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