Penn Entertainment: OSB marketing exclusivity with ESPN to end of December 1

Penn Entertainment (PENN) announced realignment of its digital focus following the mutual decision for an early termination of its U.S. online sports betting agreement with ESPN (DIS). Pursuant to the agreed termination, the company’s OSB marketing exclusivity with ESPN will end on December 1, 2025. Other key terms of the Termination Agreement are as follows: Cash payments to ESPN terminate at the end of the fourth quarter in 2025; ESPN will retain vested warrants to purchase 7,957,210 shares with a weighted strike price of $28.951; All unvested warrants and performance warrants will be forfeited by ESPN; and PENN to rebrand OSB offering in the U.S. to theScore Bet, with a target date of December 1, 2025, subject to regulatory approvals. Jay Snowden, Chief Executive Officer and President, said: “When we first announced our partnership with ESPN, both sides made it clear that we expected to compete for a podium position in the space. Although we made significant progress in improving our product offering and building a cohesive ecosystem with ESPN, we have mutually and amicably agreed to wind down our collaboration… PENN’s iCasino forward approach has clear long-term alignment to our core business, which will focus on cross-sell opportunities across our ecosystem and enhanced connectivity to our 33 million member PENN Play loyalty program. Our OSB offerings will continue to provide top of funnel acquisition and cross-sell opportunities for our Hollywood-branded iCasino, which will remain integrated into our OSB product in states where legal, in addition to serving as a standalone iCasino app. We will operate with a more efficient cost structure, including replacing fixed media spending with performance based and regionally targeted marketing that complement our casino footprint. The realignment will free up resources to strategically invest in the North American markets with strong return potential which we expect will drive enhanced unit economics and profitability.”