Penn National Acquires Score Media For $2B: Why Barstool Sports Founder Dave Portnoy Says It's A Good Match

Score Media and Gaming Inc SCR shares jumped more than 75% on Thursday after Penn National Gaming, Inc PENN announced a $2 billion buyout of Score.

What Happened? Penn National announced a takeover of Toronto-based Score Media, owner of theScore. The acquisition will help expand Penn National’s mobile sports betting reach into Canada.

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Why It’s Important: Penn National estimates the Score Media buyout will add $200 million adjusted EBITDA in the medium-term and $500 million in the long term. The deal will also provide opportunities to leverage Score’s in-house technology, particularly as it ramps up its Barstool Sports and Barstool Sportsbook & Casino apps.

“In addition to the synergies, we’ll be gaining access to theScore’s deep pool of product and engineering talent and data-driven user analytics, which will help drive our customer acquisition, engagement, retention strategies, and cash flows,” Penn National CEO Jay Snowden said in a statement.

TheScore has its own sports gambling and media division, launching theScore Bet app for mobile gambling in 2019. The company estimates the Canadian mobile sports betting market can grow to $5.4 billion by 2025, including $2.1 billion in Ontario alone.

In its recently released earnings report, Penn National reported $1.5 billion in second-quarter revenue.

Influential Barstool Sports founder Dave Portnoy expressed his support for the deal on Twitter on Thursday.

“There is nobody else who does what they do. The Score was 1st company I tried to acquire when Chernin invested in us. Couldn’t afford it. It is the perfect compliment for us,” Portnoy tweeted.

Benzinga’s Take: Penn National hit a home run when they acquired Barstool for $450 million in early 2020, so it’s difficult to question its buyout of theScore at this point.

In the year following the Barstool takeover in January 2020, Penn National shares gained 257%.

Photo: theScore