• About Us / Contact
  • Responsible Gambling
This site contains commercial content
SportsHandle
  • US Sports Betting
    • Arizona
    • Arkansas
    • Colorado
    • Connecticut
    • Delaware
    • Illinois
    • Indiana
    • Iowa
    • Kansas
    • Louisiana
    • Maine
    • Maryland
    • Massachusetts
    • Michigan
    • Mississippi
    • New Jersey
    • New Mexico
    • New York
    • Ohio
    • Oregon
    • Pennsylvania
    • Tennessee
    • Virginia
    • West Virginia
    • Wyoming
  • Pending States
    • California
    • Florida
    • Georgia
    • Missouri
    • North Carolina
  • Canada
    • Ontario
    • British Columbia
    • Alberta
  • Sportsbook Apps
    • FanDuel
    • BetMGM
    • Caesars
    • PointsBet
    • BetRivers
  • Tools
    • Sportsbook Bonuses Explained
    • Sports Betting Revenue Tracker
    • Sports Betting Podcasts
    • Partnership Tracker
    • Expected Value
    • Sports Scores And Odds Apps
    • Sports Betting Twitter
    • Guide To ‘Risk-Free’ Bets
  • News
No Result
View All Result
SportsHandle
  • US Sports Betting
    • Arizona
    • Arkansas
    • Colorado
    • Connecticut
    • Delaware
    • Illinois
    • Indiana
    • Iowa
    • Kansas
    • Louisiana
    • Maine
    • Maryland
    • Massachusetts
    • Michigan
    • Mississippi
    • New Jersey
    • New Mexico
    • New York
    • Ohio
    • Oregon
    • Pennsylvania
    • Tennessee
    • Virginia
    • West Virginia
    • Wyoming
  • Pending States
    • California
    • Florida
    • Georgia
    • Missouri
    • North Carolina
  • Canada
    • Ontario
    • British Columbia
    • Alberta
  • Sportsbook Apps
    • FanDuel
    • BetMGM
    • Caesars
    • PointsBet
    • BetRivers
  • Tools
    • Sportsbook Bonuses Explained
    • Sports Betting Revenue Tracker
    • Sports Betting Podcasts
    • Partnership Tracker
    • Expected Value
    • Sports Scores And Odds Apps
    • Sports Betting Twitter
    • Guide To ‘Risk-Free’ Bets
  • News
No Result
View All Result
SportsHandle
No Result
View All Result

Penn National Gaming Lands Market Access Agreement With DraftKings, PointsBet, theScore and The Stars Group

Penn Interactive Ventures will manage comprehensive portfolio across more than a dozen states

Matt Rybaltowski by Matt Rybaltowski
July 31, 2019
in Industry
penn national website
Share on FacebookShare on Twitter

Penn National Gaming, Inc. announced Wednesday evening that it has entered into multi-year agreements with several prominent sports betting operators, orchestrating a power play that could shape the U.S. legalized gambling market over the next decade.

Under the deal, Penn National has inked sports betting and iGaming market-access agreements with DraftKings, PointsBet, theScore and The Stars Group across the company’s portfolio. The portfolio will be managed by Penn Interactive Ventures, LLC (PIV), a wholly owned subsidiary of Penn National Gaming.

“We’re pleased to be providing the top names in sports betting, iGaming and poker access to our Company’s non-primary licenses to conduct these operations in exchange for a combination of upfront cash and equity, one-time market access fees and ongoing revenue sharing,” Jon Kaplowitz, Penn National’s senior vice president of interactive gaming said in a press release.

Breakdown of skin agreements

The multi-year partnerships were reached through so-called “skin agreements,” which Kaplowitz believes will help the company finance the initial costs associated with the launch and maintenance of its primary sports betting and iGaming initiatives. A skin agreement provides an online sportsbook operator with market access in a certain jurisdiction under a land-based casino’s existing license.

Each of the aforementioned skin partners will have the option to own, operate, and brand real-money online sports betting, poker, and casino offerings, Penn National said in a statement.

Of course, the skin deals are subject to license availability, state law, and regulatory approvals; in some states such as New Jersey and Indiana, each casino operator may use up to three skins, while in Pennsylvania it’s one only.

DraftKings, one of the leaders of the New Jersey online market, will enter seven additional states  under the agreement. The partnership builds upon a December 2018 agreement between Penn National and DraftKings that gave DraftKings market access to West Virginia. Under Wednesday’s agreement, DraftKings will gain market access in Florida, Indiana, Missouri, Ohio, Pennsylvania and Texas.

The sides agreed on a 10-year deal, subject to a 10-year extension. Penn National’s portion of the revenue-sharing agreement between the companies is based on DraftKings’ net gaming revenue in the seven states.

“With dozens of states having already legalized sports betting or poised to do so in the near future, this expanded partnership ensures DraftKings is positioned to quickly enter new markets,” said DraftKings Chief Business Officer Ezra Kucharz in a press release. “Penn National Gaming brings tremendous resources, people and experience to the partnership and, as we finalized the terms of the deal, it was abundantly clear there is a real synergy between our two companies that bodes very well for the future.”

PointsBet USA Inc., a subsidiary of Australian-based PointsBet Holdings Limited, secured market access to five states – Indiana, Louisiana, Missouri, Ohio and West Virginia. The agreement will last 20 years starting with the date that PointsBet’s branded service is first offered to its customers in each applicable state, PointsBet said in a press release.

“Partnering with Penn provides PointsBet access to five important states and the potential for further state deals,” PointsBet CEO Sam Swanell said in a statement. “We are delighted to partner with such a forward-thinking and innovative organization.”

A press release issued by Penn National on Wednesday night provides a colorful picture for how the competing operators may gain access to various states — including states like Texas where sports betting may not become legal in the next five years or more — and what Penn National gains from it all. Here’s what each party obtains in the deal:

  • DraftKings:
    • States covered: Florida (1st skin), Indiana (3rd skin), Missouri (1st skin), Ohio (1st skin), Pennsylvania (1stskin), Texas (1st skin) and West Virginia (2nd skin)
    • Term of agreement: 10 years, subject to a 10-year extension
    • Key economic terms: Revenue share to Penn National based on net gaming revenue
  • PointsBet:
    • States covered: Indiana (2nd skin), Louisiana (1st skin), Missouri (1st skin), Ohio (1st skin) and West Virginia (3rd skin)
    • Term of agreement: 20 years
    • Key economic terms: Revenue share to Penn National based on net gaming revenue
    • Equity position: PIV will take a strategic equity stake of 5.28 percent in PointsBet, with an additional $2.5 mm access fee for Ohio, based on certain conditions, payable in cash or equity at Penn National’s option. In addition, PIV will receive 10,372,549 options, exercisable for two years, to acquire additional shares of PointsBet
  • theScore:
    • States Covered: Indiana (2nd skin), Iowa (2nd skin), Kansas (3rd skin), Louisiana (1st skin), Maine (3rdskin), Massachusetts (3rd skin), Michigan (3rd skin), Mississippi (1st skin), Missouri (2nd skin), Ohio (2ndskin) and Texas (2nd skin)
    • Term of agreement: 20 years
    • Key economic terms: Revenue share to Penn National based on net gaming revenue
    • Equity Position: PIV will take a strategic equity stake of 4.7% in theScore, with the potential for this stake to increase as additional market access fees become payable.
  • The Stars Group:
    • States covered: Illinois (1st skin), Indiana (1st skin), Kansas (2nd skin), New Mexico (2nd skin), Maine (2nd skin), Massachusetts (2nd skin), Michigan (2nd skin), Ohio (1st skin) and Texas (1st skin)
    • Term of agreement: 20 years
    • Key economic terms: Upfront payment of $12.5 mm payable cash, with an additional access fee of $5 mm in cash for Texas based on certain conditions; revenue share to Penn National based on net gaming revenue, with a one-time bonus based on net gaming revenue in 2023

Kambi: Penn National ‘ideal partner’

Penn Interactive Ventures will run the majority of the company’s sports betting and iGaming operations through a partnership with Kambi Group plc, a leading B2B service provider.

“Kambi’s strategy has always been to partner with tier one operators, particularly those that share our vision and passion for sports and  sports  wagering.  In  Penn  National,  we  have  found  an  ideal partner, one  that  is  not  only passionate  about  providing  high -quality  sports  wagering  experiences  to  its  customers,  but  a company that adheres to the highest level of ethical business standards,” said Kambi CEO Kristian Nylén in a press release.

One immediate takeaway from the comprehensive agreement is the glaring absence of William Hill U.S. Last August, the Penn National and William Hill held preliminary discussions on a market access and technology deal, according to London media outlet City A.M. 

The deal comes weeks after Eldorado Resorts announced a definitive merger agreement with Caesars Entertainment that could result in the largest casino company in the world. Earlier this spring, Eldorado completed a 25-year deal with William Hill U.S., under a partnership that gave the company a 20 percent equity stake in the U.S. subsidiary. Separately, William Hill powers the sportsbook operations at the Hollywood Casino at Charles Town Races in West Virginia and Penn National Race Course in Pennsylvania, two Penn National properties.

The Penn Gaming bombshell pretty much ensures that Joe Asher is going to get very litigious with the WH rights to Eldorado and Caesars properties post CZR/ERI merger.

WH has rights to ERI properties
DK has rights to CZR properties

Asher v. Robbins round two.

— Captain Jack Andrews (@capjack2000) August 1, 2019

Kaplowitz is hopeful that Penn National will be able to utilize Kambi’s managed-trading services and omni-channel software to execute a sports betting strategy that will maximize value to shareholders. He cited Kambi’s multi-channel solution, as well as its trading and risk-management capabilities as drivers for the partnership.

Penn National will make use of Kambi’s flexible technology and open APIs to develop a bespoke front-end for its retail and online sportsbook, Kambi Chief Commercial Officer Max Meltzer said. In addition, Penn National will be able to utilize Kambi’s differentiated pricing and risk management tools to create a unique offering from state to state.

Penn National already in PA, MS and WV

Penn National operates more than three dozen gaming facilities across nearly 20 U.S. states, including Pennsylvania, Mississippi and West Virginia, all of which have legal sports betting, as well as Illinois, which legalized early this summer. Penn National is the nation’s largest regional gaming operator. Several states, most notably Iowa, are expected to launch legalized sports betting in the coming weeks.

Needless to say there is still a lot of white space… for @KambiSports to run with?

— Alfonso Straffon 🇨🇷🇺🇸🇲🇽 (@astraffon) August 1, 2019

As of 8:30 p.m. ET, Nasdaq listed Penn National lost 0.27 (1.38%) to 19.25 a share, in after hours trading.

Share7TweetShare
Matt Rybaltowski

Matt Rybaltowski

Matt is a veteran writer with a specific focus on the emerging sports gambling market. During Matt's two decade career in journalism, he has written for the New York Times, Forbes, The Guardian, Reuters and CBSSports.com among others. In his spare time, Matt is an avid reader, a weekend tennis player and a frequent embarrassment to the sport of running. Contact Matt at matt@usbets.com.

Related Posts

(Matt Krohn/USA TODAY)
Sports

Raptors Midseason Review: Jurassic Park May Be Empty For Bettors In 2023 Playoffs

January 27, 2023
nbc skyline
Analysis

New York Poised For $2 Billion Sports Wagering Handle In January

January 27, 2023
Load More

Top Stories

patrick mahomes

Mahomes’ Ankle Speculation Twists Line Movement In Chiefs-Bengals Rematch

January 27, 2023
fanatics-grand-opening

Fanatics Sportsbook At FedEx Field Offers Unique Retail Option In Maryland

January 23, 2023
Shutterstock

Missouri Legislators Lament Exodus Of Bettors To Neighboring States

January 27, 2023
rob gronkowski adam vinatieri

Rob Gronkowski Goes Training Montage Route In Latest FanDuel Spot

January 17, 2023

State Sports Betting Guides

Ohio (U.S. state) flag waving against clear blue sky, close up, isolated with clipping path mask alpha channel transparency, perfect for film, news, composition

Ohio Sports Betting – Where To Play, Bonus Offers And Promo Codes

by Brian Pempus
January 25, 2023

Downtown Detroit at twilight (Shutterstock)

Michigan Sports Betting – Where To Play, Online Sportsbooks, And FAQ

by Brett Smiley
January 27, 2023

VA captial

Virginia Sports Betting – Where To Play, Online Sportsbooks And Bonus Offers

by Brett Smiley
January 17, 2023

nj flag

New Jersey Sports Betting — Where To Play, Online Sportsbooks, And FAQ

by Brett Smiley
October 20, 2022

pa online sportsbooks

Pennsylvania Sports Betting – Where To Play, Online Sportsbooks And Bonuses

by Brett Smiley
October 6, 2022

Canada Sports Betting Guides

Canada Sports Betting – Best Sportsbook Apps & Bonus Offers

British Columbia Sports Betting – Legal Update, Available Sportsbooks, and FAQ

Ontario Sports Betting – Legal Status And Where To Play

gambling therapy
ncpg
igaming ontario
If you or someone you know has a gambling problem, crisis counseling and referral services can be accessed by calling 1-800-GAMBLER (1-800-426-2537) (IL). Gambling problem? Call 1-800-GAMBLER (MI/NJ/OH/PA/WV), 1-800-9-WITH-IT (IN), 1-800-522-4700 (CO), 1-800-BETS OFF (IA), 1-888-532-3500 (VA) or call/text TN REDLINE 1-800-889-9789 (TN).
19+. Please play responsibly. Terms and conditions apply. 
Individuals must be 19 years of age or older to participate in igaming in Ontario. Gambling can be addictive, please play responsibly. If you, or someone you know, has a gambling problem in Ontario and wants help, please visit ConnexOntario or call their helpline at 1-866-531-2600. Operators on this website operate pursuant to an Operating Agreement with iGaming Ontario.

Search Sports Handle

No Result
View All Result
  • About Us / Contact
  • Responsible Gambling

No Result
View All Result
  • US Sports Betting
    • Arizona
    • Arkansas
    • Colorado
    • Connecticut
    • Delaware
    • Illinois
    • Indiana
    • Iowa
    • Kansas
    • Louisiana
    • Maine
    • Maryland
    • Massachusetts
    • Michigan
    • Mississippi
    • New Jersey
    • New Mexico
    • New York
    • Ohio
    • Oregon
    • Pennsylvania
    • Tennessee
    • Virginia
    • West Virginia
    • Wyoming
  • Pending States
    • California
    • Florida
    • Georgia
    • Missouri
    • North Carolina
  • Canada
    • Ontario
    • British Columbia
    • Alberta
  • Sportsbook Apps
    • FanDuel
    • BetMGM
    • Caesars
    • PointsBet
    • BetRivers
  • Tools
    • Sportsbook Bonuses Explained
    • Sports Betting Revenue Tracker
    • Sports Betting Podcasts
    • Partnership Tracker
    • Expected Value
    • Sports Scores And Odds Apps
    • Sports Betting Twitter
    • Guide To ‘Risk-Free’ Bets
  • News

loading

Please wait while you are redirected to the right page...

Please share your location to continue.

Check our help guide for more info.

share your location