Penn National Gaming made its initial investment in Barstool Sports in 2020, paying $161.2 million for a 36% stake in the content factory. Just a few years later, the casino company will acquire the remaining shares.
The relationship with Barstool has had ups and downs for Penn National.
A Business Insider report dropped in December accusing Barstool founder Dave Portnoy of sexual misconduct with multiple women caused serious headaches for Penn National. Portnoy denied any wrongdoing, saying all of the incidents detailed in the piece were consensual. He has also filed a defamation suit against the publisher.
Jay Snowden, the company’s CEO, encouraged investors to be patient. That didn’t stop the reaction though. Penn National lost over $2.5 billion in value and drew the attention of regulatory boards in Nevada and Indiana.
Still, the relationship with Barstool is one the casino company wants to keep. The company has found value in using the brand’s name to attract a younger audience to its sportsbooks. The Barstool name has been used on other venues and products inside of Penn National’s casinos as well.
Barstool podcasts and videos give Penn National a valuable, proprietary means of advertising. Plus, the Barstool Sports Arizona Bowl and the Barstool Classic in Philadelphia, put Penn National in the live sports business.
Penn National has an option to acquire the rest of Barstool for another $387 million. Bloomberg reports that the two step process will be completed by February.
