Recode’s report that AT&T plans to buy the other half of Otter Media from the Chernin Group doesn’t directly impact Barstool Sports, but it might have some interesting indirect effects on Barstool. Barstool is not part of Otter Media, an AT&T-Chernin partnership that most notably includes subscription anime service Crunchyroll and video company/consulting company/branded content company Fullscreen, but the Chernin Group does own a majority stake in Barstool (a deal announced in January 2016).
If AT&T does go through with buying the remainder of Otter (something they’ve reportedly been planning for years, and something where Digiday reported they were close to a deal back in November), that deal could value the company north of a billion, and that could perhaps provide Chernin with more time and resources to devote to Barstool.
Of course, it’s not like the Chernin Group was particularly resource-strapped before this. They’re a giant company that’s invested in everything from Tumblr to The Athletic to Second Spectrum to Dave.com, and group founder/chairman/CEO Peter Chernin has plenty of money of his own, and they just put $15 million more into Barstool earlier this year. That investment valued the company at around $100 million, and came with plenty of talk of hiring more staff, expanding Rough N Rowdy (the boxing promotion Barstool bought last fall), and possibly launching branded alcohol or sports bars and/or a premium content service; Chernin might want to see how that previous investment and those expansion plans go before putting more money into Barstool directly, even if they make a lot on the Otter Media sale. But the more significant element may be time and focus, especially when it comes to senior executives and ambitious expansion plans.
Barstool obviously has their own executives who would be a key part of any expansion strategy, from CEO Erika Nardini to founder Dave Portnoy (both seen above in January talking to CNBC’s Jim Cramer about the extra $15 million from Chernin). But it would seem logical that if Barstool was going really big on any particular expansion, that would get at least sign-off from Chernin higher-ups, and potentially significantly more involvement than that. We don’t know how much involvement anyone at Chernin has in regular operations at Barstool or if that’s largely left to Nardini and her team, but it seems likely there’s at least some contact over bigger long-term plans, especially when those are coming out of Chernin’s recent added investment of $15 million. And it might be easier for Chernin to focus on growing Barstool with one less other big property on their plate.
Chernin is still invested in a whole ton of companies, of course, but Barstool’s one where they have majority control, and it’s one where they’ve repeatedly indicated they see major growth potential and have floated numerous specific potential expansion plans. And they presumably would have been involved in growing or expanding Barstool even without this Otter sale. But it doesn’t seem unreasonable to think that Barstool might become even more of a focus for Chernin after this. And maybe that will lead to bigger things for the company.