The online sports betting market in Brazil, estimated at over R$ 150 billion (US$ 27.7bn) annually, continues on a trajectory of expansion and regulatory consolidation. Since the implementation of Law 13.756/18, which initially legalized online sports betting, to the recent enactment of Law 14.790/23 that regulates fixed-odds betting, the sector has attracted growing interest from national and international companies, driving merger and acquisition (M&A) activities.
To give an idea of the speed of this movement, Brazil is the world's leader in the number of football teams sponsored by betting companies, with 75% of Serie A clubs featuring a "bet" logo on their shirts.
Recently, over 100 companies have shown interest in adhering to the regulations by submitting licensing applications to the Ministry of Finance's Secretariat of Prizes and Bets. This wave of regularization is seen as an initial step to ensure legal and fiscal security, as well as to promote a transparent and competitive business environment.
Régis Dudena, Secretary of Prizes and Bets, recently clarified vital aspects of the licensing process. She highlighted that licensing applications must be completed by August 20 for operators interested in legally operating from 2025. This deadline is crucial for companies seeking to establish themselves firmly in the regulated market.
The detailed regulation accompanying these licenses covers everything from the taxation of operations to operational guidelines, including a minimum financial reserve of R$ 5 million (US$925k) and net worth of R$ 30 million (US$ 5.5m) for companies in the sector. These requirements are essential to strengthen confidence in the betting system and ensure the integrity of payments to bettors.
The next ordinances, expected to be published by the end of July, will provide additional guidelines for companies to adjust and respond appropriately to the established norms.
This transition phase to a regulated market opens a new chapter for the sports betting sector in Brazil, signaling a period of robust growth and greater stability. With the integration of solid regulatory practices and the promotion of mergers and acquisitions, the country is positioning itself as an emerging leader in the global online sports betting scene.
In short, the global betting market moves hundreds of billions of dollars, and a significant portion of these resources is rapidly being directed to Brazil. The new regulation has instantly created a formal and legalized billion-dollar market that all traditional players and new entrants are racing to capture a share of. This gold rush is generating and will continue to generate dozens of M&A transactions.
Fernando Pereira
M&A Financial Director at Audda
