Beyond Las Vegas sportsbooks and fantasy football leagues, Fantex Inc. is offering a new way to bet on professional athletes -- starting with the National Football League’s Arian Foster.
The company filed to raise $10.6 million in an initial public offering priced at $10 a share, according to a regulatory filing today. Fantex’s main source of income is Foster, a running back for the Houston Texans who has pledged 20 percent of the money he earns both inside and outside the NFL to the company in exchange for most of the proceeds of the IPO.
San Francisco-based Fantex, led by Chief Executive Officer Cornell “Buck” French, plans to make similar agreements with other professional athletes. Foster, 27, is in the second year of a five-year contract with the Texans, where he’s eligible to receive a salary of as much as $23.5 million through the 2016 season, the filing shows.
Foster currently has endorsement contracts with companies such as Under Armour Inc. and Kroger Co. The Pro Bowl running back also recently acquired an undisclosed stake in Health Warrior Inc., the closely held nutrition company known for its chia bars.
In his fifth NFL season, Foster has 531 yards on 117 carries, with another 183 yards on 22 catches, and has scored two touchdowns. Foster has rushed for a career total of 5,052 yards for the Texans, who are 2-4 this season.
Fantex Brokerage Services LLC is managing the offering along with Stifel Financial Corp. No investor will be allowed to purchase or hold more than 1 percent of any series of common stock issued by the company, the filing shows. Orders for the stock will be posted and executed by Fantex’s brokerage’s alternative trading system, and the shares won’t be listed on the New York Stock Exchange nor the Nasdaq Stock Market.