DraftKings, a market leader among providers of daily fantasy games, has agreed to a watershed sponsor agreement with Maple Leaf Sports and Entertainment, a deal which will be formally announced on Tuesday.

The sponsorship is worth more than $1 million per season, according to a source familiar with the matter, found money for Canada's richest sports company since fantasy gaming represents a new sponsor category.

"We're proud to be the first partner for DraftKings in Canada," David Hopkinson, MLSE's chief commercial officer, told TSN in an interview.  "Their product is exciting for fans and we're looking for many years of continued partnership as they grow their business in Canada

While the Leafs and Raptors have landed a lucrative sponsor, DraftKings gets a chance to use the marquee sports brands in its marketing.

DraftKings vice-president of business development Jeremy Elbaum said in an interview that the company plans to leverage their ties to MLSE in several ways.

Beyond traditional signage at the Air Canada Centre, DraftKings will also offer contests to the Leafs and Raptors fans that are among its biggest customers.

"We're talking about packages for our VIPs that give them discounts off their food and concession bills, a chance to attend the post-game press conference with the coaches, and some really special packages, too," Elbaum said. "We're talking about a handful of fans each year having the opportunity to travel with the team for road games. It doesn't matter how much money you have, you can't buy that kind of opportunity."

DraftKings and rival FanDuel are the biggest competitors in the fantasy gaming sector and so far, have avoided sanctions from regulators in Canada and the U.S.

Both companies are valued at more than $1 billion and spent a combined $27 million (U.S.) for 8,000 television spots in the opening week of the NFL season, The New York Times reported.

Major League Baseball already has an equity stake in DraftKings and offers daily contests on MLB.com. The NBA has an exclusive deal with FanDuel.

In November, the NHL announced a multi-year partnership with DraftKings, which also has deals with the Boston Bruins, St. Louis Blues and New York Rangers.

Officially, the NHL has opposed sports gambling, even though the league is among DraftKings' investors.

TSN reported in June that MLSE had sought a legal opinion about fantasy gaming.

MLSE had sought confirmation that services offered by companies such as DraftKings and FanDuel are legal in Canada. Both DraftKings and FanDuel already operate in Canada, offering their gaming services even though some legal experts say it's "murky" whether they are operating within the confines of the law.

Fantasy sports operates in the U.S. under an exemption to a 2006 federal law that banned online poker but permitted fantasy play under lobbying from professional sports leagues.

It's possible that daily fantasy games may test exemption. Fans pay between 25 cents and $1,000 to build rosters of real football players. Prize pools can total as much as $2 million for winners.