Penn National Gaming divided up the casino company’s potential online sports betting and online gaming operations Wednesday, announcing multi-year agreements with four sports wagering operators.
The agreements with DraftKings, PointsBet, theScore and The Stars Group gives the companies access to the Penn National’s online partnerships – often referred to as skins – and provides the casino company with a combination of upfront cash and equity, one-time market access fees and ongoing revenue sharing.
Penn National operates 41 casinos in 19 states. Eight of the company’s jurisdictions have regulated sports betting. Others are expected to launch sports betting or are considering legislation to legalize the activity.
The deal doesn’t include Penn National retail sportsbooks. The company has an agreement with sportsbook operator William Hill US to manage sports wagering facilities at Penn’s casinos and racetracks, including Nevada, Mississippi, and West Virginia.
According to a statement, the separate agreements with the four companies are through Penn Interactive Ventures, a Penn subsidiary. They each range from 10 years – subject to a 10 year extension – with DraftKings, to 20 years with the other three.
“Sports betting represents an exciting new growth opportunity for Penn National,” said Penn National Senior Vice President of Interactive Gaming Jon Kaplowitz. “Our skin agreements announced today will help fund the cost of launching and maintaining our primary sports betting and iGaming operations.”
Penn Interactive will operate the sports betting and Internet gaming initiatives through a partnership with service provider Kambi.
“By controlling our front-end product and relying upon our new partnership with Kambi for managed-trading services, we can create a lasting and differentiated online and retail product experience for our customers,” Kaplowitz said.
Under the terms of the agreements, each “skin” partner will have the option to own, operate, and brand real-money online sports betting, poker, and casino offerings in each of the states outlined in the separately negotiated deals. All skins are subject to license availability, state law, and regulatory approvals.
Legal sports betting will launch in Iowa on August 15, joining Nevada, New Jersey, Delaware, West Virginia, Mississippi, Rhode Island, Pennsylvania, New Mexico, Arkansas and New York as states with legal sportsbooks at casinos and racetracks. Indiana is also expected launch sports in August.
Penn said it would open in-house retail sportsbooks at the company Iowa and Indiana properties in the coming weeks. In a separate statement from Kambi, CEO Kristian Nylen said the Malta-based company will provide the sports betting technology for Penn in Iowa and Indiana.
“It’s an honor for Kambi to be working with an organization of the size and stature of Penn National, and we look forward to helping them become a national leader in the U.S. sports betting market in the coming years,” Nylen said. “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.”
Howard Stutz is the executive editor of CDC Gaming Reports. He can be reached at hstutz@cdcgamingreports.com. Follow @howardstutz on Twitter.
