Barstool Sports and DraftKings are said to be involved in partnership discussions
David Portnoy's Barstool Sports and DraftKings (NASDAQ: DKNG ) are reportedly in advanced discussions about a marketing partnership. That could lead to the sports media company getting back into gambling following its recent divorce from Penn Entertainment (NASDAQ: PENN ).
Sportico reported on Wednesday that Barstool Sports and DraftKings are in talks for a "more traditional marketing partnership" in which Portnoy's company would promote DraftKings odds and direct readers and viewers to the operator of online sports betting. Nothing is official yet, but it's believed Barstool's deal could be worth more than $10 million per year.
While sports betting continues to be a topic of discussion on Barstool, Portnoy's company has been unable to secure a betting marketing agreement with another operator since he purchased the company from the University of Pennsylvania last August.
After paying $551 million to buy Barstool Sports, Payne backed out of the deal after signing a sports betting deal with ESPN. Portnoy bought back his "baby" for just $1, and the area's casino operators took an $850,000 write-down on the purchase of "Barstool."
Possible Supervision by University of Pennsylvania
The agreement between Penn and Portnoy to regain control of Barstool Sports includes a provision that would entitle the casino operator to 50% of the proceeds if it sells the media company to another gaming company.
However, Portnoy does not sell Barstool to DraftKings. He said he would never sell his company again. However, Penn is believed to have stipulated that Barstool be subject to a non-compete agreement just six months after the Portnoy deal. This could amount to an oversight that paves the way for a deal with DraftKings.
On a related note, Sportico reports that the separation agreement with Penn includes a clause that prohibits Barstool Sports from re-entering the betting space until the end of the current NFL season. The Super Bowl takes place on Sunday, February 11th. So if Barstool and DraftKings were meeting today, a deal wouldn't be announced until after the big game.
Although Barstool has not had a direct relationship with a sportsbook operator for several months, sportsbook content remains a cornerstone of the provider, suggesting it may only be a matter of time before the publication joins forces with another bookmaker.
Barstool Sports, DraftKings makes sense
DraftKings is said to benefit from Penn's partnership with ESPN because of a potentially "costly relationship" between the operator and the sports network.
A partnership between Barstool Sports and DraftKings makes sense. This also includes the fact that both companies originated in Boston. This is where DraftKings is headquartered and where Portnoy founded his company.
Additionally, DraftKings demonstrates the skill of crafting media deals. In 2021, the gaming company acquired Vegas Stats & Information Network (VSiN) and signed a distribution agreement with Meadowlark Media, owner of Dan Le Batard's Show Network.
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Source: www.casino.org
