Sports gamblers in New Jersey could soon be using an ESPN-branded online sportsbook. Penn Entertainment and ESPN recently announced a 10-year deal. Penn has agreed to pay ESPN $1.5 billion in cash over 10 years for the exclusive rights deal. The deal includes allowing ESPN to buy $500 million in Penn’s purchase shares.
Chairman of ESPN, Jimmy Pitaro, sees Penn Entertainment as a long-term partner that will help to make ESPN Bet into a leading sports betting platform in the U.S.
The Barstool Sportsbook app was launched in August 2021 in New Jersey under the sports wagering license held by Freehold Raceway. Freehold Raceway is jointly owned by Penn and Greenwood Racing and Entertainment. Greenwood Entertainment is the owner of Parx Casino Sportsbook. Barstool Sportsbook will now be rebranded as ESPN Bet.
Part of ESPN’s broader ecosystem
ESPN Bet will become deeply integrated with ESPNs broader ecosystem. It already has daily betting-focused shows and has covered the gaming industry on its website and social channels for years. It has also featured popular sports-hosting personalities.
The rebranded offering will be an integral part of ESPN’s programming and content integrations. Audiences will be able to place their bets through ESPN’s digital products. According to Jimmy Pitaro, this is what they have been asking for from ESPN for some time.
Penn Entertainment is evolving
Chief Executive at Penn, Jay Snowden, believes both parties will benefit from the arrangement. It will help Penn to evolve from a regional gaming operator to a North American entertainment leader. According to the press release, ESPN Bet will include a website, mobile app, and mobile website. It will be available in the 16 states where Penn currently has licenses to operate sportsbooks. Apart from granting its shares, ESPN will also be responsible for designating a Penn board member after three years.
Barstool Sports will return to its controversial founder, Dave Portnoy. Penn sold all its common stock to Portnoy. It said it will record a loss of about $850 million on the transaction. Portnoy says it is the first time he has owned 100% of Barstool Sports in a decade. He has no intention of selling it and says that the regulated industry was probably not the best place for the type of content it creates. Penn sold the stock to get out of some of its non-competes and other restrictive covenants.
ESPN’s market size is increasing and it will continue to cover sports betting through its news and information outlets. It is also committed to responsible gambling. It will work with industry experts on best practices for responsible gaming and implement guidelines to safeguard fans. Penn is looking forward to rolling up its sleeves and getting started with its partners at ESPN. The company’s stock rose about 25% after trading in the hours following the news of its partnership with ESPN.