Posted on: July 22, 2024, 04:24h.
Last updated on: July 22, 2024, 04:24h.
Just over three years after acquiring the Vegas Sports Information Network (VSiN) from Musburger Media, DraftKings (NASDAQ: DKNG) is selling the sports betting radio network back to the original owner.
Financial terms of the transaction weren’t disclosed. DraftKings paid $70 million to purchase VSiN in March 2021. VSiN founders Brian Musburger and Bill Adee will take the reins of sports wagering media property moving forward.
VSiN will continue to deliver the news, analysis, and insights that bettors need to inform their betting decisions, with 18+ hours of unique sports betting content each day,” according to a statement issued by the buyer.
VSiN is based in Las Vegas and broadcasts from the sportsbook at the Circa Resort and Casino in downtown Las Vegas.
Announcement Arrived Soon After VSiN Sale Rumor Appeared
The official announcement of the VSiN founders buying the media entity from DraftKings arrived less than three weeks after rumors to that effect surfaced.
In a report out earlier this month, speculated the gaming company could part with the radio network for a fraction of the $70 million it paid, stoking comparisons to Penn Entertainment (NASDAQ: PENN) dumping Barstool Sports last year to founder Dave Portnoy for just $1.
That could merely speculation for the simple reason that neither the buyer nor the seller are publicly commenting on the sale price.
“DraftKings continues to optimize its investments in content and media to align with the most critical areas and needs of our business strategy, objectives, and goals,” said Stephanie Sherman, chief marketing officer at DraftKings, in the statement. “We want to thank Brian, Bill, and the entire team at VSiN for a great relationship, and we look forward to continuing to advertise on the network.”
How VSiN Could Look Post-DraftKings
It’s not yet clear if there will be immediate changes at VSiN following the separation from DraftKings, but the radio network could potentially more swiftly capitalize on growth opportunities as a freestanding company with the founders regaining operational control and editorial autonomy.
“In addition to its 24/7 stream, VSiN’s original content is accessible through multiple video and audio channels including YouTube TV, Rogers’ Sportsnet, NESN, AT&T Pittsburgh, Marquee Sports Network, a dedicated channel on iHeartRadio and TuneIn, as well as more than 300 terrestrial radio stations throughout the country, and its growing slate of podcasts,” according to the statement.
In the early days of the US sports wagering boom, deals between gaming and media companies were common with thesis being that media outlets could serve as effective customer acquisition tools for operators.
On the other hand, some large-scale media acquisitions by gaming companies have been panned by analysts and investors, indicating that the primary issue is the ability of the buyer to wring profits out of an acquired media company. DraftKings’ play for VSiN wasn’t met with such derision, but it’s possible the decision to sell the radio network could result in cost savings. DraftKings delivers second-quarter results on Aug. 1 and it’s possible the gaming company could elaborate on the decision to sell VSiN on its Aug. 2 conference call.
