[ad_1]
(Bloomberg) – Barstool Sports backer Penn National Gaming Inc. has agreed to buy Score Media & Gaming Inc. for approximately $ 1.74 billion in cash and stocks, in order to grow in the market growing North American sportsbook.
Toronto-based Score Media’s app called theScore is the best sports app in Canada and the third in North America, Penn National said in a statement Thursday. The companies have maintained a strategic partnership since 2019.
Score shareholders will receive $ 17 in cash and 0.2398 Penn National share for each Score share, or $ 32.88 per share based on Wednesday’s close – an 81% premium over the closing price of 18 . $ 14 for Score shares listed in the United States. The companies valued the deal at around $ 2 billion.
The score jumped 56% to $ 28.33 at 9:37 a.m. Thursday in New York after climbing 63%, the highest intraday since November. Penn National fell 1.2% to $ 65.44.
“We are now uniquely positioned to serve our customers seamlessly with North America’s most powerful sports, games and media ecosystem, ultimately creating a community that does not currently exist,” said Jay Snowden, CEO of Penn National.
Sparkling stock
Penn National, which bought a 36% stake in Barstool Sports from Dave Portnoy in January 2020, has seen its stock collapse in recent months amid a shortage of sporting events and as the company struggled to earn market share for its mobile gaming offerings in closely watched states. like Pennsylvania and Michigan.
The high multiple of around 120 times the earnings of Penn National shares shows investors still believe the company will be successful in mobile betting, Loop Capital Markets analyst Daniel Adam told Bloomberg News on Wednesday. The Score agreement is part of the Wyomissing, Pa.-Based company’s efforts to make it happen.
Score Media has its roots in television with a cable channel which was also called Score and broadcast a range of highlights and events.
But the network perpetually trailed two established Canadian sports networks, and CEO John Levy, who controls the company, chose to bet the future on digital assets. He sold the TV license and related assets in 2012 to focus on a sports website and app, then turned to sports betting.
Surge sharing
Toronto-listed Score shares doubled in price last year as the Canadian government moved to liberalize gambling rules, allowing betting on single sporting events for the first time. Score profited from the company’s U.S. listing in February.
“We’re not building this as a shiny new object just to hold it there and say, come get me,” Levy said in an interview in January. He said the company will review all offers.
Goldman Sachs and Code Advisors provide financial advice to Penn National, with Wachtell, Lipton, Rosen & Katz and Blake, Cassels & Graydon as legal advisers. Score obtains financial advice from Morgan Stanley and Canaccord Genuity Group, and legal services from Paul, Weiss, Rifkind, Wharton & Garrison and McCarthy Tétrault. Greenhill & Co. Canada Ltd. is an independent financial advisor to Score’s board of directors.
(Update of stock activity in the fourth paragraph)
More stories like this are available at bloomberg.com
Subscribe now to stay ahead of the game with the most trusted source of business information.
© 2021 Bloomberg LP
[ad_2]
Source link