July 31, 2019 / 11:06 PM / 18 days ago

Penn National makes major sports betting push with new deals

NEW YORK (Reuters) - Casino operator Penn National Gaming Inc on Wednesday announced a spate of partnerships with sports book operators, including with digital sports media company theScore Inc., giving the partners access to sports betting markets across the United States in exchange for fees, equity and a share of betting revenues.

FILE PHOTO: Gamblers place bets on sports at Monmouth Park Sports Book by William Hill, shortly after the opening of the first day of legal betting on sports in Oceanport, New Jersey, U.S., June 14, 2018. REUTERS/Mike Segar/File Photo

Through the agreement, theScore will be able to operate its soon-to-launch mobile app in 11 states where sports wagering is now or will soon be legal.

In addition, Penn National will give new partners DraftKings Inc, PointsBet USA Inc and The Stars Group Inc access to certain states where Penn National operates.

Kambi Group plc was selected to run Penn National’s own land-based and online sportsbooks.

TheScore, a newcomer to sportsbook operations based in Toronto, is the only media outlet in North America to say that it will become a bookie itself. It is on track to launch its sportsbook this fall in New Jersey before football season begins.

Other media companies have stepped somewhat more cautiously into the sports betting space since a U.S. Supreme Court decision in May 2018 that overturned a federal ban on the activity in most places outside of Nevada. Ten states now offer live, legal sports betting, with more to come.

AT&T Inc’s Bleacher Report and Walt Disney Co’s ESPN both said this year that they will open studios at Caesars Entertainment Corp’s Las Vegas casinos.

In May, Fox Sports, a unit of Fox Corp, said it was investing $236 million for a nearly 5 percent stake in gaming provider The Stars Group as part of a deal to launch its Fox Bet-branded wagering platform later this year.

But the Penn National deal gives theScore, with 4 million monthly users, a chance to become a big player in the nascent U.S. sports betting industry and a challenger to fantasy sports sites DraftKings and Flutter Entertainment PLC’s FanDuel, whose sportsbook apps dominate the New Jersey market.

“I can’t wait to go after that,” John Levy, theScore’s founder and chief executive, said of the fantasy sites’ market share, in an exclusive interview with Reuters. “We’re staking our whole brand on this.”

The company will privately place $10 million of shares, with $7.5 million going to the newly created Penn National subsidiary Penn Interactive Ventures LLC (PIV), which will get a 4.7 percent stake in theScore. Other investors include Levy’s family holdings.

PIV said it will also take a 5.28% equity stake in PointsBet.

Reporting by Hilary Russ; Editing by Sonya Hepinstall and Leslie Adler

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