Casino and racetrack operator Penn National Gaming has entered into an agreement to acquire a 36% interest in sports media firm Barstool Sports for circa $163m in cash and convertible preferred stock. 

The agreement will see Penn become Barstool Sports’ exclusive gaming partner for up to 40 years. Additionally, it will have sole rights to utilize the Barstool Sports brand across its online and retail sports betting and icasino products.

Penn National President Jay Snowden welcomed the deal, saying: “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, with 66 million monthly unique visitors, the significant reach of Barstool Sports and the loyalty of its audience will lead to meaningful reductions in customer acquisition and promotional costs for Penn’s sports betting and online products. That, in turn, he said will significantly enhance profitability and drive value for shareholders.

Barstool CEO Erika Nardini 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.”