IG Underdog deal could climb above $2 billion, as IG Group uses the acquisition to push deeper into prediction markets and expand in the United States.
IG agreed to pay $1.1 billion upfront for Underdog. It also set a $200 million earnout for Underdog shareholders. In addition, IG may pay up to $850 million to eligible Underdog employees if the platform reaches EBITDA of $400 million in 2028 and $700 million in 2029.
The broker said the deal is meant to build a customer funnel for its next growth phase. It also sees the purchase as a way to lift its US business. IG said it now expects to more than double US revenue and raise US monthly active customers by more than ten times.
IG Underdog Deal Targets US Growth
In the first six months of 2025, IG made £103.4 million from its US-focused businesses. That was 18 per cent higher than a year earlier. Meanwhile, active customers in the country rose 11 per cent to about 104,500, and 21,100 customers placed their first trades.
IG already has 1.4 million customers worldwide, with about 843,600 active users. Underdog brings a much larger consumer base. The platform has more than 11 million registered accounts, over 5 million depositing customers, and about 1 million monthly active users on average.
Breon Corcoran said earlier that IG views prediction markets as a form of binary options. He said prediction markets are another name for products that used to be binaries in Europe, or products once seen on betting exchanges in Europe.
Underdog Revenue and Deal Structure
Underdog began as a fantasy sports company. Later, it moved into sports betting in early 2024. However, it shut its sportsbook in late 2025 and entered prediction markets in September 2025.
For the 12 months ended June 30, 2026, Underdog posted about $466 million in net revenue, up 21 per cent. In the last three months of that period, revenue reached about $122 million, while EBITDA came to about $46 million. The $1.3 billion headline price equals 2.4 times Underdog’s last-12-month net revenue through June 2026.
On a pro forma basis, using both companies’ audited 2025 results, the US would account for about 40 per cent of group revenue, up from 22 per cent for IG alone. IG also said prediction markets and fantasy sports would make up about 25 per cent of combined total net trading revenue. The broker expects the acquisition to be neutral to adjusted earnings in year one, then deliver double-digit percentage accretion by year three.
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Source: Finance Magnates
