WPT snapped up by Party Gaming

10/02/2009

The rumours flying around the online gambling industry recently that Party Gaming plc was about to make an offer for World Poker Tour Enterprises have been confirmed by a company announcement that a deal is in progress.

PartyGaming said Tuesday that it had agreed to buy the U.S.-based gaming firm for $12.3 million (GBP 7.5 million) in cash.

The Gibraltar-based Internet gambling group said it would also pay a minimum of $3 million over the next three years to World Poker Tour's vendors on an ongoing revenue share related to the assets purchased.

The acquisition is expected to be completed in the fourth quarter of 2009.

WPT confirmed that it had agreed to sell substantially all of its operating assets other than cash, investments and certain excluded assets to Peerless Media, a unit of ElectraWorks, which is owned by PartyGaming.

The acquisition move makes a lot of sense; PartyGaming is WPT's largest customer, accounting for 30 percent of its revenue for the six months ended June 28, according to a WPT regulatory filing.

Last month, PartyGaming said it was looking for further acquisitions in the wake of its purchase of bingo website operator Cashcade for an initial GBP 71.9 million (see previous InfoPowa reports).

In August this year a $9.075 million plus a percentage of future revenues agreement of sale between WPT and the Gamynia group was put on hold in compliance with procedures prescribed in the sales agreement when WPT received what at that time was an unidentified "alternative proposal," which now appears to have been the Party Gaming offer.