One dollar. That is how much Barstool Sports founder Dave Portnoy has paid to buy back full control of the sports and bro lifestyle brand from Penn Entertainment. Filings with the Securities and Exchange Commission say Portnoy has signed a noncompete agreement and agreed to other restrictions in exchange for paying what Penn calls a “nominal cash consideration.” Under the teams of his deal with Penn, Portnoy will receive half of the proceeds of any future sale of Penn’s media brand.
In a multipronged deal, Penn Entertainment announced that it had sold Barstool back to Portnoy. At the same time Penn has inked a $2 billion deal with Disney that will see the online Barstool Sportsbook gaming app rebranded ESPN Bet this fall.
It was a major pivot for Penn, which initially announced a partnership with Barstool in January 2020, with the gaming company acquiring 36% of Barstool for $163 million. It then raised its stake to 64% in February for $405.5 million in a deal that valued Barstool at $660 million. The initial agreement had included a path for Penn to establish full control and ownership of Barstool Sports. The SEC filing also reveals that Barstool has been operating at a loss. It says Barstool had $80.9 million in revenue during the first six months of 2023 with losses totaling $16.1 million.
When the dust settles, Penn now says it expects to lose between $800 and $850 million on its investment in Barstool.
The deal has returned Portnoy to full owner of Barstool for the first time in a decade, and in a video announcing the deal he said he does not expect to bring on any new partners going forward. “For the first time in forever, we don’t have to watch what we say, how we talk, what we do – it’s back to the pirate ship,” he said. “This is now going to be a place for content.”