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Home Business Penn National Gaming Acquires theScore To Boost Its Efforts In The iGaming Market

Penn National Gaming Acquires theScore To Boost Its Efforts In The iGaming Market

by Milcah Lukhanyu
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More than ever, United States-based companies are making their presence known in other countries. Database company Statista discovered that in 2020, foreign direct investment (FDI) from the US to other countries amounted to roughly $6 trillion, up from $5.91 trillion the year prior, while in 2021, we have seen several industry giants disclose plans to invest capital outside of the United States. For example, on October 8th, California-based tech behemoth Google announced at its virtual event for its newly launched Africa Investment Fund that the company will invest $1 billion in Africa over the next five years. This money will ensure access to fast and cheap internet and support the continent’s ongoing digital transformation, which has resulted in significant growth in industries such as the mobile money services sector. (According to reports, in 2020, there were 310 live mobile money services, and out of these, over 50% were in Africa.) 

Neighbors Turned Business Partners

Companies in the United States are looking for investments closer to home, too, such as in Canada. Most recently, we saw Penn National Gaming, based in Wyomissing, Pennsylvania, acquire theScore in August 2021. Penn National Gaming is an omnichannel provider of live racing, online gaming, and sports betting entertainment, and theScore is a digital media company headquartered in Toronto, Canada. The acquisition, purchased with an even split of cash and stock, is part of Penn National Gaming’s strategy to improve its standing and influence in the iGaming and mobile sportsbook market. It’s an understandable business goal to have, considering globally, the iGaming market is forecasted to grow at a compound annual growth rate of 11.5% over the next few years to reach $127.3 billion by 2027, as per Grand View Research

For a company trying to become a leader in the iGaming industry, theScore is the perfect target to get a foot in the door. The Canadian digital media company operates a unique sports media app and online sports betting service, which is accessible in four states in the US (Iowa, Indiana, New Jersey, and Colorado). It has main apps in Canada and within the top five popular sports betting app in the United States, behind Yahoo! Sports and ESPN. Since 2019, theScore has cemented itself as one of the most influential voices in sports media, demonstrated by its successful social media metrics, including a growth rate of 31% between January 1 and August 31, 2019, and an increased interaction rate of 3.2% during the same period. “We are thrilled to be acquiring theScore,” said Penn chief executive Jay Snowden. theScore chairman and chief executive John Levy echoed Snowden’s excitement, stating that the Penn-Score deal “brings together two companies that share a vision for how media and gaming intersect.”

Double The Track Record, Double The Confidence

We know iGaming is a fast-growing industry, but as it has gotten more popular, there has been an increase in competition, with platforms trying different, sometimes unethical ways, to attract users. As a result, consumers have to ensure they are using services with proven track records. For example, most iGaming review sites, such as time2play, agree that trust is earned, and the best iGaming platforms are those that offer promotions like no-deposit bonuses and free spins, as well as those that have a range of payment methods (15+ at least), and an easy-to-navigate interface. Platforms that offer these things tend to have a Playscore or expert rating of no less than 50%, and fortunately, both theScore and Penn National Gaming’s online betting services, such as the Barstool sportsbook, which Penn purchased 36% of in 2020 for $163 million in cash and stock, fit this mold. theScore offers several payment methods such as debit/credit cards and Play+ card/e-wallet; Penn’s Barstool sportsbook offers different player incentives, such as a $10 sign-up bonus and a $1,000 casino bonus during their first 24 hours.

According to reports, Penn’s acquisition of theScore will see the company compliment Penn’s Barstool sportsbook. “Users will enjoy a unique mobile sports betting and iCasino platform with highly customized bets and enhanced in-gaming wagering opportunities,” said Snowden. Additionally, the deal will allow Penn National Gaming to put its products on a proprietary platform. Snowden, who replaced Tim Wilmott in 2020 as chief executive, added that theScore has developed an account management system and is establishing an in-house managed trading services platform, which will allow Penn to broaden its product offerings.

Penn National Gaming’s Making Major iGaming Moves

Penn National Gaming’s move into the online sportsbook and iGaming market may be fresh, but its strategy to improve its standings in the growing industry is already bearing fruit. According to Google Finance, at the time of writing on October 12th, 2021, PENN stock is up roughly 3% in the past five days on the Nasdaq Exchange. The stock is up nearly 14% in the past year and more than 400% in the past five years, which indicates Penn’s recent ventures have helped it become the billion-dollar company it is today.

Any recent stock growth, however, can be associated with the entrance of Jay Snowden, who only two months after joining the casino and racetrack operator announced a deal to purchase a percentage of Barstool Sports. Had this deal not happened, there is no telling if Penn would have purchased theScore or if the Canadian company would have looked elsewhere for acquisitions. That said, this deal makes as much sense for theScore as it does Penn National Gaming.

Penn has a profitable physical presence in the casino business, with its brick-and-mortar casino business generating healthy cash flow to support its investment in iGaming. However, the company’s competitors in the iGaming space such as DraftKings do not have the same physical presence to aid investments. In many ways, it is a win for both companies, but we cannot deny that Penn National Gaming will benefit a little more. The US-based company is now positioned to provide its customers with one of the best ecosystems of gaming, media, and sports in North America.

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