Two months after agreeing to end its billion-dollar online sports betting agreement with ESPN, PENN Entertainment is making organizational changes with a new restructuring.
PENN Entertainment underwent a new corporate restructuring process that significantly changes the company’s Interactive segment, which manages online sports betting and online casino gaming. PENN’s restructuring impacts its operations in both the U.S. and Canada, including the dissolution of two senior executive positions. PENN’s board of directors approved the reorganization and it is effective immediately.
PENN cuts two executive positions
PENN eliminated its Chief Information Officer role, which was held by Rich Primus, who stepped down from the position after more than 10 years in the role. PENN also eliminated the role of Vice President of Operations, which was held by Todd George.
George left PENN after spending more than a decade in various roles, including senior vice president of Midwest regional operations and executive vice president. He was also integral in the development and opening of PENN’s Hollywood Casino Joliet.
The $185 million, 189,000-square-foot entertainment facility opened in August.
“Both Todd and Rich have made significant contributions to PENN’s evolution over the past decade and helped build the strong foundation we have in place today,” said PENN CEO Jay Snowden. “On behalf of the company’s board of directors, I want to express my appreciation for their dedication and efforts to PENN over the years and wish them well in their future endeavors.”
PENN seeking COO for digital business
PENN is looking to bolster its Interactive segment with the appointment of a COO for the business. The digital COO will report to Aaron LaBerge, who joined PENN as the company’s CTO in 2024. LaBerge joined PENN after spending over 20 years at Disney.
PENN’s new digital COO will be responsible for managing the day-to-day operations of the Interactive division, allowing LaBerge to focus on the company’s technology teams and a new responsibility for managing the company’s enterprise IT functions. LaBerge, who led digital integrations between PENN and ESPN, will also maintain his current responsibilities.
PENN plans to explore additional organizational changes. The company will continue to evaluate its operations and provide an update on its organizational structure next month.
PENN’s board of directors stirs controversy
PENN activist investor HG Vora voiced concerns about “underperformance” and PENN’s nearly $2 billion investment to launch ESPN Bet in 2024. HG Vora’s criticisms were later laid out in a 116-page investor presentation shared online on how PENN is mismanaged.
HG Vora would also take issue with how PENN managed its board seats, leading to a lawsuit in Pennsylvania that claims PENN evaded regulatory oversight and violated the law by removing one of the three board seats up for election without notifying shareholders.
HG Vora requested that it have a representative sit on the board to help drive long-term value for shareholders amid concerns about PENN’s underperformance. PENN would later elect two new board members despite HG Vora’s request for three. The company also reduced the total number of board seats from nine to eight.
HG Vora’s claims led PENN to form a special litigation committee and hire a law firm. The committee and law firm investigated HG Vora’s claims and found PENN “acted on an informed basis, in good faith and for the best interests of PENN in the exercise of its business judgment in its decision to reduce the overall size of the board from nine to eight.”
The committee also determined that “it would not be in the best interests of the company to pursue the HG Vora claims or take other action.” The firm, Dilworth Paxson LLP, and the committee investigated the claims by conducting interviews and reviewing documents.
