Casino and racetrack operator Penn National Gaming has signed an agreement to buy a 36 percent stake in sports media group Barstool Sports for about $163 million in cash and preferred common shares.
The contract will see Penn become the official gaming partner of Barstool Sports for up to 40 years. Additionally, the use of the Barstool Sports name through its online and retail sports betting and icasino goods will have sole rights.
Penn National Chairman Jay Snowden supported the agreement and said: “This exciting new partnership with Barstool Sports reflects our strategy to continue evolving from the nation’s largest regional gaming operator, with 41 properties in 19 states, to a best-in-class omni-channel provider of retail and online gaming and sports betting entertainment.”
He added: “With its leading digital content, well-known brand and deep roots in sports betting, Barstool Sports is the ideal partner for Penn National and will enable us to attract a new, younger demographic, which will nicely complement our existing customer database.”
According to Snowden, the significant scope of Barstool Sports and the engagement of its audience would lead to significant reductions in customer acquisition and advertising costs for Penn’s sports betting and streaming goods, with 66 million unique visitors each month. This, he said in effect, would significantly improve productivity and boost value for shareholders.
Erika Nardini, CEO of Barstool said: “Over the last five years, Barstool Sports has brought its audience, creativity and expertise to the biggest sports betting and DFS operators in the country with great results. The chance to combine our content and fans with Penn National’s massive footprint, and to develop a unique and compelling omni-channel approach together, was for us a no brainer.”
Founder Dave Portnoy added: “This opportunity is a dream of mine and why I started Barstool Sports in the first place. Barstool Sports has a deep sports and gaming history and from the moment we met Jay and the Penn National team we knew this could be an exciting and game changing partnership and we can’t wait to get started. I think with our shared vision and goals, we are uniquely positioned to be a leader in this business.”
Jon Kaplowitz, Head of Penn Interactive, commented: “We look forward to introducing our 20 million mychoice customers to the Barstool Sportsbook brand through our retail sportsbooks and our interactive products.
“Our growing team of product and engineering talent at Penn Interactive is focused on what we anticipate will be a best-in-class sports betting app, which is expected to launch in the third quarter of 2020. Our team is excited to begin collaborating with Barstool Sports on ways to utilize its key talent and leading content to drive audiences to Penn National’s online gaming products and retail locations, as well as to special events and fan experiences.”