Penn National Gaming Buys Canadian Score Media & Gaming for $2bn
August 26, 2021
The North American gambling market is rightly undergoing a renaissance with major brand consolidations and partnerships which are changing the landscape for the better.
Shortly after Penn National Gaming’s primary competitor DraftKings completed a $1.56 billion acquisition of Golden Nugget online casino the company announced its own major multi-billion-dollar acquisition to reassert its market dominance.
Snatching Up theScore
Literally weeks after the CEO of Toronto-based Score Media & Gaming was crowing about the successful addition of single-event betting in Canada and what this means for his flagship online and mobile gambling site theScore, he was back in the spotlight announcing the sale of his company to Penn National Gaming for a whopping $2 billion in cash and stocks.
In speaking to Fox Business about the sale he said:
“If you look at our deal, it really is an amazing fit. This is the deal that’s really transformative for all of sports gaming. It really gives Penn the ability to tick all the boxes and we couldn’t be more happy to have them as our umbrella corporation.”
For Penn National Gaming there are definite benefits in acquiring a company like theScore which rather than simply being a customer database has built its success on an impressive suite of in-house technology and marketing tools.
This deeper value was confirmed by Penn National CEO Jay Snowden:
“In addition to the synergies, we’ll be gaining access to theScore’s deep pool of product and engineering talent and data-driven user analytics, which will help drive our customer acquisition, engagement, retention strategies, and cash flows.”
The market was clearly in favour of the deal as theScore stock priced closed 79% higher on the day of the announcement and lost less than 3% within the next 48 hours showing a residing trust in the valuation.
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Stocks and Cash On The Table
Besides the wow factor of selling for $2 billion, the deal structure is one that really serves theScore shareholders and rewards them for their support of the company.
Here are some of the highlights of the deal:
- The deal is expected to close in Q1 2022
- Shareholders will receive $34 in value per theScore share
- Payment will consist of $17 in cash and 0.24 shares in Penn National stock
Speaking of rewarding their shareholders Levy said:
“The transaction also provides theScore shareholders immediate liquidity at a substantial premium and an opportunity to participate in any future upside of the combined company.”
As investors in the gambling space receiving not only a handsome cash payout but also shares in one of the strongest American online, mobile, and land-based gambling companies is a major benefit.
With such a strong bid it comes as no surprise that the offer of $2 billion for 97% ownership of Score Media & Gaming received unanimous approval from both the Board of Directors and shareholders.
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