Barstool Spots’ $450 million deal with Penn National Gaming will alter the landscape of sports betting. Perhaps the fastest growing sports media company in the country is directly aligning itself with the burgeoning industry of sports betting
It’s seemingly only a matter of time before we start seeing the creation of Barstool-branded casinos.
Penn National finalized its purchase of Barstool Sports late Tuesday, valuing the company at a whopping $450 million. The regional casino operator will immediately buy a 36% stake in Barstool for $163 million in cash and stock, according to the Wall Street Journal. Three years later, the company will pay an additional $62 million to increase its stake to 50%. At that point, Penn National would be able to buy controlling ownership of the former subway station gambling rag.
Barstool Sports has come a long way from its humble beginnings. It is now a media behemoth.
The brand received its first big infusion of cash in 2016, when the Chernin Group purchased the company for a reported sum between $10 and $15 million. Two years later, the Chernin Group pumped another $15 million into the iconic bro brand.
Nowadays, Barstool Sports is a dominant force in the podcast arena. It is currently the sixth-biggest podcast publisher in the U.S., ranking ahead of ESPN and NBC News. Two of its shows, “Pardon My Take” and “Call Her Daddy” — a show featuring two female hosts who talk openly and vividly about sexual intercourse — are two of the 10 most-popular podcasts in the entire country.
Penn National Gaming is a low-profile regional casino operator whose most noteworthy property is probably the Tropicana in Las Vegas. It will now become the official betting partner of Barstool Sports, which already produces a plethora of gambling-related content. That means the Penn National logo and brand will be omnipresent in the lives of millions of college — middle-aged men throughout the country.
In other words, the prime market for casino operators.
Since the Supreme Court legalized sports betting nationwide two years ago, 14 states have permitted the practice within their borders. At this point, none of the major professional sports league boast partnerships with casino operators and gambling companies, but that day appears to be coming. The Raiders moving to Las Vegas represents a surefire sign the NFL is on the verge of embracing sports betting — once it becomes a bit more palatable. (Several NFL franchises are in partnerships with daily fantasy sports companies.)
Penn National is currently developing sports book and online casino apps, and has been vocal about its desire to find a media partner for both ventures. They hit a home run with Barstool Sports, which maybe carries more sway with its audience than any other media company today. Shortly after the sale was announced, Portnoy urged his followers — “Stoolies” for short — to buy Penn National stock. Coincidence or not, the gaming company’s stock soared Wednesday.
Since Penn National is a gaming company, it’s almost certainly not concerned with Barstool’s smutty reputation and lewd content. It just cares about audience, and a vehicle to push its sports gambling products.
It found the perfect partner. There is a new powerhouse in the sports betting world.