Penn’d a deal
Penn National Gaming to buy minority stake in Barstool Sports
Penn National Gaming Inc. announced Wednesday that it has agreed to buy a minority stake in Barstool Sports Inc. for $163 million, a move that the casino company hopes will put it in a prime position to compete in the growing sports-betting market in the U.S.
Under the agreement, Barstool Sports — a digital sports, entertainment and media platform — will become exclusive gaming partners with Penn National for up to 40 years and will give it the sole right to use the Barstool brand for all of its sports-betting products.
Penn National expects to close the deal in the first quarter of 2020, according to a company press release.
“With its leading digital content, well-known brand and deep roots in sports betting, Barstool Sports is the ideal partner for Penn National,” Jay Snowden, president and CEO of Penn National, said in a statement.
While the deal will initially give Penn National a 36% stake in Barstool Sports, that will increase to about 50% in three years, with an additional investment of $62 million. It also gives Penn National customary governance rights, including initially two seats on Barstool Sports’ seven-member board of directors.
“Penn National Gaming has one of the biggest infrastructures in the country for gambling. They have sports tracks, they have casinos, they’re all over the country. They have the infrastructure, we have this rabid audience, this fan base craving it. Together, we’re going to create an omnipresent approach to gambling,” David Portnoy, president and founder of Barstool Sports, said in statement on Twitter.
Entities affiliated with The Chernin Group, which previously owned around 60% of Barstool Sports, will own 36% after the deal is finalized, with the remaining 28% to be held by Barstool Sports’ employees, including Portnoy and CEO Erika Nardini.
Penn National operates 41 facilities in 19 states and is aiming to turn some of Barstool Sports’ 66 million monthly unique visitors into customers of its own, including for its sports betting and online products, Snowden said.