Penn National Gaming (PENN) – said Wednesday that it has agreed to acquire a 36% interest in Barstool Sports for $163 million that values the sports media platform at $450 million.
Shares of Penn National Gaming were soaring 10.2% to $28.87.
Under the agreement, Penn National Gaming will be Barstool Sports’ exclusive gaming partner for up to 40 years and have the sole right to use the Barstool Sports brand for all of its online and retail sports betting and iCasino products.
The transaction is expected to close in the first quarter.
At that time entities affiliated with the media and investment company Chernin Group, which that purchased a majority stake in Barstool in January 2017 in a deal worth roughly $100 million, will also retain 36% control of the company. Barstool employees will control the remaining 28%.
“We look forward to introducing our 20 million mychoice customers to the Barstool Sportsbook brand through our retail sportsbooks and our interactive products,” Jon Kaplowitz, head of Penn Interactive, said in a statement. “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.”
Penn National Gaming, based in Wyomissing, Pennsylvania, operates 42 facilities in the United States, many of them under the Hollywood Casino brand. The company is scheduled to release its fourth-quarter results on Feb. 6.
Barstool Sports, founded in 2003 by David Portnoy, is a digital sports, entertainment and media platform that delivers original content across blogs, podcasts, radio, video and social and has 66 million unique visitors each month, the company said. Barstool Sports grew about 65% in 2019, delivering nearly $100 million in revenue.