The brick-and-mortar casino and racetrack operator Penn National Gaming Inc. (PENN:NASDAQ) has finally completed the takeover of Toronto-based digital media firm Score Media Inc. (theScore) in a whopping $2 billion cash and stock transaction. Initially made public in August, the deal will see the creation of “a complete one-stop entertainment destination”.
TheScore comes in as the number 1 sports media app in Canada and the third-most popular app in North America right behind Bleacher Report that falls under the ownership of Yahoo Sports and Turner Broadcasting System.
Following an agreement by both parties earlier this year, the sale was initially meant to take place in the first quarter of 2022. But in the wake of recent approvals, including that of the Supreme Court of British Colombia, the sale was move forward.
Based on an official press release, immediately before the date of the transaction, Penn National, along with its subsidiary companies did own approximately 2.98% of theScore’s outstanding shares. The deal saw theScore shareholders receiving US$17.00 (C$21.04) in cash money and “either 0.2398 of a share of Penn National common stock (each full share, a “Penn Share”) or, in the event of being validly elected, 0.2398 of an exchangeable share in the purchaser’s capital. Penn National shares were trading at US$77.30 on NASDAQ at the time closing on October 18, 2021, a day before the transaction’s effective date.
This deal worth $2 billion cash and stock will then see the current shareholders of Penn National Gaming along with those of theScore hold close to 93% and 7% respectively, of the firm’s outstanding shares.
Natural alignment
“It is a truly exciting time to join Penn National and collaborate with their team to build a highly innovative and first-of-its-kind sports media and gaming company,” said John Levy, the chair and CEO of theScore.
John Levy further stated that there’s a “natural alignment” between the 2 companies, and they are “perfectly positioned to capitalize on the growing entertainment opportunities across mobile sports media, sports betting and online casino.”
Levy also went on to say that the combined company is now “well-positioned” in its bid to continue expanding their business entity across North America, including what he says to be the “expected opening of sports betting and igaming in Ontario later this year.”
Strengthening of overall capability
Based on a statement from Penn National, the final acquisition of Penn National “fortifies its digital media and gaming strategy” while creating “a complete one-stop entertainment destination.”
By going ahead to add theScore’s fully integrated betting and media platform along with advanced technology, this Wyoming-headquartered firm’s existing ecosystem will undoubtedly further be strengthened along with its ability to “seamlessly serve its customers.” Furthermore, the firm hopes to achieve “best-in-class engagement and better customer acquisition and retention” across its media and gaming portfolio by combining theScore with Barstool Sports, which Penn National purchased in January 2020 for $450 million.
Newer market opportunity
“We’re excited to be creating this powerful new entertainment flywheel that will provide us with multiple growth channels that transcend our current business verticals,” said Penn Nation Gaming President and CEO Jay Snowden.
Snowden further added that they are now looking forward to penetrating Canada’s gaming market, a market that he says “represents a compelling new opportunity, and are proud to have John Levy and his family and their entire team bring their best-in-class technology, unique perspective and skill sets to our Penn National family.”
