Shares of DraftKings jumped 13% in premarket trading after the company said Michael Jordan is joining the betting company as a special advisor to the board of directors.
Jordan, a member of the National Basketball Association Hall of Fame, will have an equity interest in the company as part of the deal. He is the current chairman and owner of the Charlotte Hornets franchise.
“Michael Jordan is among the most important figures in sports and culture, who forever redefined the modern athlete and entrepreneur,” DraftKings CEO Jason Robins said in a press release. “The strategic counsel and business acumen Michael brings to our board is invaluable, and I am excited to have him join our team.”
Jordan is expected to offer DraftKings his expertise on sports company strategy, product development, diversity, equity and belonging, marketing activities and other key initiatives, according to the release.
The assist from the six-time NBA Finals MVP and Chicago Bulls icon will likely come as welcome addition to the DraftKings team.
The Covid-19 pandemic continues to disrupt scores of professional and college sports leagues as efforts to contain the coronavirus force athletes and fans home.
But despite the Covid-19 headaches, investors remain largely positive on DraftKings’s longer-term outlook and have sent its stock soaring more than 240% so far this year to $36.93 by Tuesday’s close.
Its ability to broker a deal with the likes of Jordan is perhaps the most striking example yet of the excitement surrounding the sports gambling world and the wealth now tied to the nascent industry.
A recent addition to the public markets, DraftKings in April combined with Diamond Eagle Acquisition Corp., a special purpose acquisition company, and gaming technology provider SBTech. The move allowed it to circumvent the typical initial public offering process.
At the time it went public and closed its merger with Diamond Eagle on April 24, DraftKings was worth about $780 million. It’s now worth north of $13 billion, according to FactSet estimates.