Fanatics, the retailer specializing in licensed sporting goods, is reportedly selling 60% of its stake in non-fungible token (NFT) company Candy Digital. The company is selling its stake in Candy Digital to a group of investors linked to billionaire Mike Novogratz and his company Galaxy Digital. Report Says Sports Retailer Fanatics to Sell Majority of Shares in Candy Digital After a tough 2022 in the non-fungible token (NFT) industry, licensed sporting goods company Fanatics has decided to sell 60% of its shares in Candy Digital, according to a CNBC report published on January 4, 2023. CNBC received an internal...
Fanatics, the retailer specializing in licensed sporting goods, is reportedly selling 60% of its stake in non-fungible token (NFT) company Candy Digital. The company is selling its stake in Candy Digital to a group of investors linked to billionaire Mike Novogratz and his company Galaxy Digital.
After a tough 2022 in the non-fungible token (NFT) industry, licensed sporting goods company fanatic has decided to sell 60% of its shares in Candy Digital, according to a CNBC report published January 4, 2023. CNBC obtained an internal email quoting Fanatics CEO Michael Rubin.
“By disposing of our ownership stake at this time, we were able to ensure that investors were able to recoup the majority of their investment in cash or through additional shares of Fanatics – a favorable outcome for investors, particularly in an imploding NFT market that has seen a precipitous decline in both transaction volumes and prices for standalone NFTs,” the email said to have been written by Rubin.
The news that Fanatics dumped 60% of its stake in Candy reportedly comes on the heels of the NFT company put down more than a third of its workforce at the end of November 2022, according to several people familiar with the situation. Fanatics' founder and executive chairman went on to say that the decision to sell his Candy shares was "a pretty simple and straightforward decision for us for a number of reasons."
“Over the past year, it has become clear that NFTs are unlikely to be sustainable or profitable as a stand-alone business,” explains Rubin’s email. “Aside from physical collectibles (trading cards), which drive 99% of the business, we believe digital products will have more value and utility when coupled with physical collectibles to create the best experience for collectors.”
Fanatics operates several e-commerce sites, including nflshop.com and fanatics.com. In January 2022, the company acquired candy and collectibles company Topps for approximately $500 million. Like Candy, Topps also offers a range of NFT collections and its own digital collectibles marketplace for brands like Major League Baseball (MLB) and Garbage bucket children.
What do you think about Fanatics selling 60% of the company's Candy Digital shares? Let us know your thoughts on this topic in the comments section below.
Photo credit: Shutterstock, Pixabay, Wiki Commons, Editorial image rights: II.studio / Shutterstock.com
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