Michael Jordan becomes investor, adviser to DraftKings

NBA legend Michael Jordan is taking an equity stake in DraftKings in exchange for becoming a special adviser to the sports betting and fantasy sports company. The deal sent shares of DraftKings roughly 8% higher on Wednesday.

Jordan is the chairman of Hornets Sports and Entertainment, the ownership group of the Charlotte Hornets. He will provide guidance and strategic advice to DraftKings' board of directors. The size of Jordan's equity interest in DraftKings was not revealed.

"Michael Jordan is among the most important figures in sports and culture, who forever redefined the modern athlete and entrepreneur," Jason Robins, CEO and co-founder of DraftKings, said in a news release Wednesday. "The strategic counsel and business acumen Michael brings to our board is invaluable, and I am excited to have him join our team."

A six-time NBA champion and member of the Naismith Memorial Basketball Hall of Fame, Jordan will provide DraftKings with input to the board of directors on company strategy, product development, diversity, equity and belonging and marketing activities, among other key initiatives, according to the release.

In 2015, Jordan, along with fellow NBA owners Ted Leonsis of the Washington Wizards and Mark Cuban of the Dallas Mavericks, invested in Sportradar, an international company that provides data to bookmakers around the world.

"NBA team investors, including governors, are permitted to have involvement with sports betting and fantasy sports businesses, subject to safeguards required under league rules to prevent actual or perceived conflicts of interest," an NBA spokesperson told ESPN.

Barstool Sports president and founder Dave Portnoy said he doesn't believe that Jordan getting an equity stake in online gambling platform DraftKings will help the company's long-term profitability. "It’s a splashy move, but unless they are taking his action, he’s a notorious gambler, I don’t think it's going to help their profitability by any sense," Portnoy told FOX Business on Wednesday.

DraftKings' stock closed at $39.90 per share, up more than 8% at the end of Wednesday's trading session.