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Dave Portnoy buys Barstool Sports back for next to nothing, years after selling it

Barstool Sports founder Dave Portnoy poses with Sebastian the Mascot prior to the game between the Miami Hurricanes and the Florida State Seminoles at Watsco Center on January 22, 2022 in Coral Gables, Florida.Mark Brown/Getty Images

Dave Portnoy is once again the owner of Barstool Sports.

Portnoy bought the company stock back from PENN Entertainment after a deal initiated in 2020.

PENN had finalized its complete acquisition of Barstool this year in the deal worth $551 million.

Dave Portnoy is once again the owner of Barstool Sports.

PENN Entertainment, a casino and sports gaming business, finalized its complete acquisition of Barstool earlier this year in a deal worth $551 million after acquiring a minority stake of the sports blog site in 2020 for an initial $163 million.

On Tuesday, Portnoy, who founded Barstool in 2003 said in a video posted to Twitter: “PENN Entertainment and Barstool Sports have gone our separate ways. So that is right, for the first time in a decade, I own 100% of Barstool Sports.”

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Penn and Barstool agreed to go their separate ways as the gambling operator signed a new 10-year deal with Disney’s ESPN that will see Penn’s existing Barstool Sportsbook rebranded as ESPN BET this fall. Penn is paying ESPN $1.5 billion over the course of the deal and $500 million in warrants tied to media, marketing, and other services from ESPN, according to the announcement.

Penn had also drawn tougher scrutiny from some regulators in recent months due to its relationship with Barstool Sports, the New York Times and other outlets had reported.

“Every time we did something, it was one step forward, two steps back,” Portnoy said in his video announcement on Tuesday. “We got denied licenses because of me. You name it. So the regulated industry probably not the best place for Barstool Sports and the type of content we make.”

According to a press release published Tuesday, PENN sold 100% of the Barstool’s common stock back to Portnoy “in exchange for certain non-compete and other restrictive covenants.”

PENN also has the right to receive half of the gross proceeds received by David Portnoy in any subsequent sale or other monetization event of Barstool, according to the terms of the deal.

Penn’s relationship with Barstool hasn’t been entirely smooth sailing. In May, Penn overrode Barstool executives when the company fired Ben Mintz, who said a slur while reading the lyrics to a song aloud on a livestream. It happened during the same week as Penn’s first-quarter earnings report, in which it missed Wall Street’s estimates, and the stock fell to its lowest level since May 2020, the Action Network reported.

Penn shares were up 14% in after-hours trading on Tuesday, when it announced the new Barstool Sports and ESPN arrangements.

Representatives for PENN National and Barstool Sports did not immediately respond to Insider’s requests for comment.

Read the original article on Business Insider