Key Penn Entertainment investor The Donerail Group has hit out at what it believes are “continued and significant strategic failures” by the company.
In an open letter, The Donerail Group said Penn has “not been able to demonstrate the management expertise necessary to build a business that could become a formidable competitor in the online sports betting oligopoly.”
Its criticisms also centred on CEO Jay Snowden, with the group noting its belief that Penn’s board “has an obstinate and heightened level of confidence in the company’s management team” and is willing to give Snowden “exorbitant amounts of money” despite Penn’s “underperformance.”
The Donerail Group has therefore called for an “immediate strategic shift” at Penn, stating that the company’s equity price will otherwise “continue to stall.”
The Donerail Group said it believes a sale of Penn’s assets “could generate meaningful and certain value creation for equity investors.”
The open letter criticised various moves from Penn including its US$1.5bn deal with ESPN Bet to rebrand Barstool Sports as ESPN Bet.
