Canadian government approves Penn National’s deal to acquire theScore

The Minister of Canadian Heritage has given Penn National Gaming approval to acquire the Toronto-based theScore, under the Investment Canada Act.

This comes after Penn National announced plans to acquire theScore back in August.

Penn receives approval from the Canadian government

The US gambling giant Penn National Gaming has received approval from the Minister of Canadian heritage for its purchase of Score Media and Gaming. The acquisition was approved under the Investment Canada Act.

Both companies announced they had received approval for the deal in Canada on Thursday.

Now that the deal has been approved in Canada,  the acquisition is now expected to close on 19 October 2021. However, the purchase is still subject to approval by theScore’s shareholders at a special meeting.

The deal also still requires receipt of a final order from the Supreme Court of British Columbia, and “satisfaction or waiver of the other conditions” contained in the arrangement agreement.

The special meeting is set for Tuesday 12 October 2021 and 11 am Toronto time. 

Penn’s deal to acquire theScore

Back in August, Penn announced plans to acquire theScore’s parent company, Score Media and Gaming, in a deal worth approximately $2bn.

This deal builds on an existing partnership between the companies from 2019, where Penn provided market access to theScore’s sportsbook product in several US states.

According to the initial announcement, Penn announced plans to acquire the Canadian business for $2bn in a combination of cash and stock. Penn expects to fund the approximately $1 billion cash portion of the consideration using existing cash on its balance sheet.

Under the terms of the agreement, theScore shareholders will receive $17 in cash and 0.2398 shares of Penn National common stock for each theScore share. 

This implies a total purchase consideration of $34 per theScore share based on Penn National’s 5-day volume-weighted average trading price as of 30 July, 2021.

Once the deal is complete, Penn shareholders will hold 93% of the company’s outstanding shares, while theScore shareholders will hold 7%. theScore will continue to operate as a stand-alone business and will remain headquartered in Toronto. The Levy family will continue to lead the business.

When it was first announced, it was stated that the purchase has been unanimously approved by the boards of directors of both companies and was expected to close in the first quarter of 2022.

Earlier this year, Jay Snowden, President and Chief Executive Officer of Penn National, said: “We are thrilled to be acquiring theScore, which is the number one sports app in Canada and the third most popular sports app in all of North America. theScore’s unique media platform and modern, state-of-the art technology is a powerful complement to the reach of Barstool Sports and its popular personalities and content.”