Penn Entertainment told shareholders it is ready to improve its sports betting product, but made it clear it can pivot if necessary.
Chairman David Handler and CEO Jay Snowden co-penned a letter to shareholders to open its proxy statement concerning its June 17 annual meeting, hitting on its ESPN Bet sports betting product as a main topic.
“That said, our market share and financial performance in sports betting to date has not met our expectations,” the letter reads. “Our Board and management team are moving swiftly and decisively to recalibrate execution and unlock the full value of this partnership. We have a committed partner and shared desire to compete and build share in a financially responsible way.
“While our initial integrations have expanded reach and driven customer acquisition, we recognize there’s more work to do to deliver on the full potential. As mentioned on our Q4 earnings call, we are optimistic that our joint efforts with ESPN will deliver improved results over the coming quarters, but we maintain optionality and control of our future in this vertical if this does not prove to be the case.”
Either side can opt out of the deal at its third anniversary in August.
Penn nominates two new directors…
Penn nominated two board members whom activist investor HG Vora suggested earlier this year:
- Johnny Harnett brings significant sports betting experience. He was previously the CEO of Superbet Group and held multiple positions within Flutter before that.
- Carlos Ruisanchez, an experienced finance executive, was the CFO at Pinnacle Entertainment when Penn acquired it in 2018.
…but HG Vora expected three
HG Vora made it clear it expected all three of its proposed candidates to be nominated for board seats in a Monday filing (emphasis is HG Vora’s):
“On April 15, 2025, PENN notified HG Vora in writing of the Company’s intention to hold an election for three Board seats at the Annual Meeting. On the morning of April 25, 2025, representatives of PENN and HG Vora discussed how best to fill the three available Board seats.
“HG Vora’s representative reiterated HG Vora’s belief that all three of its candidates would be successfully elected to the Board by PENN’s shareholders if the proxy contest went to a final vote. Later that same day, PENN’s Board announced the extraordinary action, in the midst of the proxy contest, of reducing the number of Board seats to be filled at the Annual Meeting.”
HG Vora will nominate all three of its candidates and solicit shareholder approval, the letter said.
Penn did not respond to LSR’s request for comment.
