Disney’s ESPN, Penn Entertainment to wind down ESPN Bet
ESPN Bet logo on a laptop held on Thursday, February 22, 2024 in New York, USA.
Gabby Jones | Bloomberg | Getty Images
Disney’s ESPN and Penn Entertainment like that termination sports betting partnerships brought an end to Penn’s ESPN Bet brand of sports betting years earlier than planned.
The partnership, which came together in 2023, allowed ESPN to rebrand and relaunch Penn’s sports betting site, then known as Barstool Sportsbook, as ESPN Bet. The agreement had a duration of 10 years.
On Thursday, Penn and ESPN announced they had mutually agreed to end the partnership early. The sportsbook will be rebranded as Score Betting.
“When we first announced our partnership with ESPN, both parties made it clear that we expect to compete for podium position in the space,” Penn CEO Jay Snowden said in a press release.
“Although we have made significant progress in improving our product offering and creating a compatible ecosystem with ESPN, we have mutually and amicably agreed to end our collaboration,” he said.
The 10-year partnership allowed ESPN or Penn to terminate the deal after the third year “if certain market share performance thresholds are not met,” according to the statement. Still, Thursday’s announcement brings the deal to an end in just over two years.
ESPN Chariman Jimmy Pitaro said in a statement that the company is “currently pursuing other media and marketing opportunities in this space.”
ESPN signed the deal with Penn after spending some time searching for a gambling partner. Disney has made it clear in the past that it will never take direct bets, making partnership the only viable way for ESPN to enter the booming online sports gambling industry.
Sports betting has become an integral part of ESPN’s direct-to-consumer streaming platform.
According to the statement, the ESPN Bet brand is expected to end on December 1.
Under the original agreement, ESPN agreed to give Penn exclusive rights to its brand for sports betting, media and marketing services. In exchange, Penn agreed to pay ESPN $1.5 billion in cash over a 10-year period and issued approximately $500 million in warrants to ESPN to acquire approximately 31.8 million Penn common shares during the same period.
The companies on Thursday said Penn’s $150 million in annual cash payments and warrants to purchase Penn’s common stock will expire in the fourth quarter.
