The ESPN Bet logo on a laptop arranged in New York, United States, Thursday, February 22, 2024.
Gabby Jones | Bloomberg | Getty Images
Disney ESPN and Penn Entertainment are ending their sports betting partnership, ending the ESPN Bet brand on Penn sports betting years ahead of schedule.
The partnership, completed in 2023, allowed ESPN to rebrand and relaunch Penn’s sportsbook — then known as Barstool Sportsbook — as ESPN Bet. The agreement had a duration of 10 years.
On Thursday, Penn and ESPN announced they had agreed to end the partnership ahead of schedule. The bookmaker will once again be renamed TheScore Bet.
“When we first announced our partnership with ESPN, both parties made it clear that we intended to compete for a podium spot in this space,” Penn CEO Jay Snowden said in a press release.
“While we have made significant progress in improving our product offering and building a cohesive ecosystem with ESPN, we have mutually and amicably agreed to end our collaboration,” he said.
The 10-year partnership allowed either ESPN or Penn to terminate the deal after the third year “if specific market share performance thresholds were not met,” according to the release. Still, Thursday’s announcement ends the deal after just over two years.
ESPN President Jimmy Pitaro said in the release that the company is “now pursuing additional media and marketing opportunities in this space.”
ESPN had signed the deal with Penn after spending time looking for a gaming partner. Disney had made clear in the past that it would never accept bets directly, making a partnership the only viable path for ESPN to enter the booming online sports gambling industry.
Sports betting has become an integral part of ESPN’s direct-to-consumer streaming platform.
The ESPN Bet brand is expected to cease operations by December 1, according to the release.
As part of the original deal, ESPN agreed to provide Penn with exclusive rights to its brand for sports betting, as well as media and marketing services. In exchange, Penn agreed to pay ESPN $1.5 billion in cash over a 10-year period and also granted ESPN approximately $500 million in warrants to purchase approximately 31.8 million shares of Penn common stock that would vest over the same period.
On Thursday, the companies announced that Penn’s $150 million in annual cash payments would cease in the fourth quarter, as would Penn’s common stock warrants.