PENN Entertainment has reached an agreement with ESPN to launch a news sportsbook and sold its all ownership shares of Barstool Sports back to company founder Dave Portnoy, who revealed the move in a video shared on his Twitter account Tuesday (August 8).
“PENN Entertainment and Barstool Sports have gone our separate ways. As of this moment, while you are watching this video, I have purchased back Barstool Sports from PENN. So that is right, for the first time in a decade, I own 100% of Barstool Sports,” Portnoy said.
ESPN chairman Jimmy Pitaro confirmed the company's partnership with PENN Entertainment and the upcoming launch of ESPN Bet in a statement obtained by Front Office Sports on Tuesday.
“Our primary focus is always to serve sports fans and we know they want both betting content and the ability to place bets with less friction from within our products,” Pitaro said. “The strategy here is simple: to give fans what they’ve been requesting and expecting from ESPN."
PENN confirmed that it sold "100%" of Barstool Sports back to Portnoy “in exchange for certain non-compete and other restrictive covenants," as well as the “right to receive 50% of the gross proceeds received by David Portnoy in any subsequent sale or other monetization event of Barstool,” according to a BusinessWire.com press release.
Portnoy had previously sold the majority of shares in Barstool Sports to The Chernin Group in 2016, which relinquished control following the media company's partnership with PENN in 2020, instead maintaining a 36% stake in the company. PENN later exercised an option to buy the remaining shares and become the sole shareholder of Barstool Sports in February.
"Not since the Chernin deal have I been in total control of everything," Portnoy said.
"We underestimated just how tough it is for myself and Barstool to operate in a regulatory world where gambling regulators, the New York Times, Business Insider hit pieces f–king with the stock price. Every time we did something it was one step forward two steps back,” Portnoy added. “We got denied licenses because of me. You name it. So the regulated industry probably not the best place for Barstool Sports and the content we make...I am never going to sell Barstool Sports ever. I'll hold it 'til I die."