British broker IG Group has agreed to acquire US prediction market platform Underdog for $1.1bn. The deal combines retail trading, prediction markets and sports gaming, giving the buyer access to one of the fastest-growing segments.
The structure includes up to $200m in contingent payments tied to 2026 financial performance, and an $850m management incentive programme that vests only if EBITDA reaches at least $400m in 2028 and $700m in 2029. Underdog reported net revenue of $466m for the twelve months to June 2026, and $250.1m in the first half of 2026 with positive EBITDA of $59.6m. The platform has over 11 million registered users and more than five million depositing customers.
Underdog launched prediction markets on its own exchange this month. The company originally operated as a DFS provider — that business generated over $400m net revenue in 2025 — but is now expanding into prediction markets, where it competes with Kalshi, Polymarket, FanDuel and DraftKings. The platform holds the full US licence package: FCM, DCM and DCO, allowing it to list its own contracts and clear trades without intermediaries. Only three operators in the sports segment hold that combination.
The acquisition will shift IG Group's audience profile sharply. More than 60% of Underdog's active users are under 30, compared to IG's average customer age of 42; post-merger the combined average will fall to 34. The US share of group revenue will rise from 22% to 40%. There is cross-sell potential: 58% of Underdog customers have traded equities, 46% crypto, and 42% fund accounts with cryptocurrency.
IG Group plans to roll out prediction market offerings first through its tastytrade platform in the US, then internationally. European expansion remains an open question: in Britain such platforms must operate under gambling law, while Sweden treats them as illegal gambling. Gibraltar recently created a separate regime for prediction markets, but it is the first jurisdiction to do so. The deal is expected to close in late 2026 or early 2027 pending regulatory approval.
