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Started By
Message
Did Portnoy pay anything to get Barstool back?
Posted on 8/9/23 at 8:13 am
Posted on 8/9/23 at 8:13 am
quote:
Penn sold 100% of the Barstool's common stock back to Portnoy "in exchange for certain non-compete and other restrictive covenants."
No cash? Or they just aren’t listing it?
5
Posted on 8/9/23 at 8:14 am to mule74
Deal of the century. Got it back for $0
Posted on 8/9/23 at 8:20 am to mule74
Yes.
Noncompete with Penn. Cannot market for anyone that competes against them.
50% of any dividends in future
50% of proceeds from any future sale.
Noncompete with Penn. Cannot market for anyone that competes against them.
50% of any dividends in future
50% of proceeds from any future sale.
Posted on 8/9/23 at 8:52 am to lsu13lsu
quote:
Noncompete with Penn. Cannot market for anyone that competes against them.
That’s actually pretty big. Their gambling shows are their most profitable and I assume a large portion of their ad revenue comes from gaming companies.
Posted on 8/9/23 at 8:54 am to lsu13lsu
This deal is being marketed as much better for Barstool than it really is. Penn got a better deal with ESPN than Barstool for betting. But Barstool completely loses its betting market share and ability to be in the betting market. That was the most market with the most opportunity for Barstool. Essentially this deal turns Barstool back into solely content creation, so they have to harvest ad revenue and merchandising to make money. Which is much less profitable. And if Portnoy tries to offload or cash in again, he’s paying a hefty price
Posted on 8/9/23 at 9:28 am to Upperdecker
quote:
And if Portnoy tries to offload or cash in again, he’s paying a hefty price
Lets recap that hefty price for Portnoy. The net result of the Penn deals resulted in Portnoy going from like 30% ownership of Barstools to 100% and what did he pay? Oh he didn't pay but instead got paid like $125M. If he were to sell it AGAIN yes Penn gets 50% but I wouldn't call that a hefty price when he already got paid 9 figures to go from 30% to 100% ownership minus 50% cut for Penn if he were to sell.
quote:
Penn got a better deal with ESPN than Barstool for betting.
I think this remains to be seen. Obviously ESPN is a bigger name in sports than Barstools but they are paying a hefty price for the name as well.
Now who could pay the ultimate price? The other Barstool employees if the company doesn't do well under the non-compete contract. Is it confirmed that they cannot sell adds to other books/betting platforms or can they just not start their own book/betting platform?
This post was edited on 8/9/23 at 9:33 am
Posted on 8/9/23 at 10:01 am to bod312
Why so defensive? We are just explaining that he just didn't get handed the company for nothing.
Posted on 8/9/23 at 10:07 am to bod312
quote:
I wouldn't call that a hefty price when he already got paid 9 figures to go from 30% to 100% ownership minus 50% cut for Penn if he were to sell.
He went from 30% of a fully marketable company to 50% of a company with significantly reduced marketability
Posted on 8/9/23 at 10:11 am to Upperdecker
....for $0.
Posted on 8/9/23 at 10:47 am to Upperdecker
quote:
He went from 30% of a fully marketable company to 50% of a company with significantly reduced marketability
Apparently, he still owns a substantial amount of Penn stock. So, if the Disney play works out, he stands to benefit from that as well.
Posted on 8/9/23 at 1:04 pm to mule74
so does no one see Barstool becoming a paid advertiser by this new entity to convert their userbase to the new espnbets? i do not believe they will be fully removed from gambling content or advertising.
Posted on 8/9/23 at 1:21 pm to Upperdecker
quote:
This deal is being marketed as much better for Barstool than it really is. Penn got a better deal with ESPN than Barstool for betting. But Barstool completely loses its betting market share and ability to be in the betting market. That was the most market with the most opportunity for Barstool. Essentially this deal turns Barstool back into solely content creation, so they have to harvest ad revenue and merchandising to make money. Which is much less profitable. And if Portnoy tries to offload or cash in again, he’s paying a hefty price
I think you’re confusing for barstool and for Portnoy.
Portnoy sold 50% to Chernin way back when. Then they both sold 100% to Penn so Penn owned 100% of Barstool before this deal.
Dave got to keep all of his money/stock in Penn and got everything he sold back but the gambling side of Barstool for free.
The only way that’s a bad deal for him is if the content side is a money eating machine that can’t be fixed which I really doubt it is.
So yes Barstool isn’t as valuable of an asset now. But he already sold that entire asset to Penn and got parts of it back for free.
This post was edited on 8/9/23 at 1:25 pm
Posted on 8/9/23 at 7:01 pm to mule74
quote:
“Dave Portnoy is the only natural owner for Barstool sports long term,” Snowden said. “They’re not a company and a brand, I think we all came to this conclusion, that should be owned by a publicly traded, highly regulated licensed gaming company.” Snowden explained that the company realized its product was quickly becoming outdated by having to rely on a third-party platform. He added that he’s looking forward to a future in sports betting with ESPN. “To Barstool’s defense — amazing partners — we didn’t spend, in the last year and a half, marketing dollars promoting Barstool Sportsbook, other than just the organic within Barstool ecosystem, because we didn’t have a product that we felt was strong enough to retain,” Snowden said. “We now have that, so this is great for Dave and Stoolie nation.”
Penn CEO Snowden was interviewed on Mad Money this evening and said this. I’m not really sure what it means.
Posted on 8/9/23 at 7:25 pm to mule74
Why didn’t they try and sell it to a 3rd party though? Or make Portnoy buy it back? It has to be worth a couple million right? That’s where I’m confused?
Is there some deal where Portnoy is going to make it worth that to them?
Is there some deal where Portnoy is going to make it worth that to them?
Posted on 8/9/23 at 8:44 pm to baldona
They were probably worried about Portnoy going elsewhere and competing. So they sell to him and lock him down in the gambling world.
Also Barstool probably takes a hit value wise without Portnoy and they still get 50% if he sells.
Also Barstool probably takes a hit value wise without Portnoy and they still get 50% if he sells.
Posted on 8/9/23 at 9:42 pm to Weagle25
quote:
Also Barstool probably takes a hit value wise without Portnoy and they still get 50% if he sells.
That’s right, I keep forgetting they get 50% if he sells it and some dividends.
Posted on 8/9/23 at 10:18 pm to mule74
They sold it back for one dollar
Posted on 8/10/23 at 8:44 am to call me goat
If I was a board member, I would be calling for the CEO’s head. PENN paid $550mm for Barstool and sold it back for $1 plus future considerations. They are taking an $850mm mark down on the deal. All this for a company with a market cap at $4B.
Penn also just got a downgrade from analyst this morning who doubts they can get the 20% market share that they think they can achieve with the ESPN deal.
Penn also just got a downgrade from analyst this morning who doubts they can get the 20% market share that they think they can achieve with the ESPN deal.
This post was edited on 8/10/23 at 9:08 am
Posted on 8/10/23 at 9:06 am to mule74
quote:
They just got a downgrade from analyst this morning who doubts they can get the 20% market share that they think they can achieve with the ESPN deal.
Why would they think 20%? That’s a very high number, only FanDuel and DraftKings have that.
Posted on 8/16/23 at 12:22 am to bod312
Yeah, I would hate to be Dave right now
/sarcasm
/sarcasm
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