The famous casino company, Penn National Gaming has obtained a stake in Barstool Sports, a transaction which values the online sports publisher at 450 million dollars! Barstool Sports is known to be controversial, “unsophisticated” and loud media company, creating live events, social media content and podcasts intended for millennial sports fans.
The firm has been establishing a database of gamblers via the Barstool Bets app that was created in the September last year. The sports betting industry is currently on the rise in North America, with platforms like https://betsafe.com/ca/ rising in popularity due to market liberalization and new sports betting regulations.
Barstool Sports is seen as a massive boost for Penn National Gaming
Penn National Gaming is to obtain a thirty-six percent in Barstool, a company that started as a Boston sports blog before it moved into a podcast and video segment. Penn National Gaming will pay another 62 million dollars in the following years, which will in return allow them to take a controlling ownership over the Barstool Sports. Expectedly, PNG stocks climbed after the news about acquisition started to float around.
The Chernin Group, a company that owned at least 60%, will now own thirty-six percent of Barstool Sports after the close of the transaction. Remaining twenty-eight percent will be held by the employees of Barstool Sports, and this includes CEO Erika Nardini and founder Dave Portnoy. The transaction will indicate that Penn National will be the exclusive gaming partner of Barstool Sports for at least forty years. Further, they have the sole privilege to employ the brand of Barstool Sports for all of its retail and online sports betting as well as iCasino products.
The Transaction Is Anticipated to Close in the First Quarter of 2020
According to Dave Portnoy, the acquisition deal was a huge dream of his and considered one of the major reasons why he started Barstool Sports. In fact, the company has a deep gaming and sports history. From the time he and Jay met with the Penn National team, they realized that everything could be a thrilling and game-changing collaboration. He added that their entire team couldn’t wait to get started. Portnoy exclaimed that they are now positioned to be a market leaders.
On the other hand, Jay Snowden, the CEO and President of the Penn National explained that Barstool Sports is the perfect partner for Penn National, along with its top digital content, deep roots in sports betting as well as the sought-after brand. It will allow them to obtain a new, younger demographic that will match their current client database.
Apart from that, they also expect that the massive reach of Barstool Sports, as well as the devotion of its audience, will result to a relevant decrease in promotional expenses and customer acquisition apart from the sixty-six million unique visitors. This will massively improve profitability and drive value for their shareholders.
Partner at The Chernin Group, Mike Kerns, explained that they are thrilled to collaborate with Penn National in the next chapter of Barstool Sports.
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