Published on: January 24, 2024, 12:49h.
Last updated on: January 24, 2024, 12:49h.
David Portnoy’s Barstool Sports and DraftKings (NASDAQ: DKNG) are reportedly in advanced discussions regarding a marketing partnership that could see the sports media entity reenter the betting space following its recent divorce from Penn Entertainment (NASDAQ: PENN).
Sportico reported earlier today that Barstool Sports and DraftKings are negotiating “a more traditional marketing partnership” that would see Portnoy’s company promote DraftKings odds and refer readers and viewers to the operator’s online sportsbook. Nothing is official as of yet, but it’s believed a deal could be worth north of $10 million annually to Barstool.
While sports wagering is still a topic of discussion on Barstool, Portnoy’s company hasn’t been able to sign a betting marketing agreement with another operator since he reacquired the business from Penn last August.
After paying $551 million to buy Barstool Sports, Penn dumped the business after inking a sports betting deal with ESPN. Portnoy paid just $1 to buy back his “baby” while the regional casino operator suffered a write-down of $850 related to the Barstool purchase.
Possible Oversight By Penn
The agreement between Penn and Portnoy under which he regained control of Barstool Sports contained provision that the casino operator would be entitled to 50% of the economics should he sell the media outlet to another gaming company.
However, he’s not selling Barstool to DraftKings. He’s said he won’t again sell his company. However, it’s believed that Penn stipulated Barstool be subject to a non-compete clause of just six months following the deal with Portnoy. That could amount to an oversight that’s paving the way for an arrangement with DraftKings.
On a related note, Sportico reported that the separation accord with Penn included a provision that barred Barstool Sports from getting back into the betting arena before the end of the current NFL season. The Super Bowl is on Sunday, Feb. 11, meaning if Barstool and DraftKings are in talks today, a deal won’t be revealed until after the big game.
While Barstool hasn’t had direct ties to a sportsbook operator in several months, sports wagering content remains a cornerstone for the outlet, indicating it was just matter of time before the publication teamed up with another gaming company.
Barstool Sports, DraftKings Deal Would Make Sense
DraftKings is said to have benefited from Penn teaming up with ESPN because the operator had what was believed to be an expensive relationship with the sports network.
There are reasons why a Barstool Sports/DraftKings partnership makes sense. Those include the point that both companies have Boston roots. That’s where DraftKings is based and that’s where Portnoy started his company.
Additionally, DraftKings has shown a knack for savvy media deals. In 2021, the gaming company acquired the Vegas Stats & Information Network (VSiN) and reached a distribution pact with Meadowlark Media, which is the owner of Dan Le Batard’s network of shows.