Allied Esports Entertainment Sells World Poker Tour
The news took the poker world by storm this week. Allied Esports Entertainment signed a definite agreement to sell the World Poker Tour and all of its assets to Element Partners.
The investment firm has made no statements regarding the future of the World Poker Tour, though WPT CEO Adam Pliska claims the deal to be a positive one. How it will affect the planned tour stops in Australia in 2021 remains as unclear as the nature of the deal itself.
Sold for US$78.25M
In late December of 2018, the World Poker Tour went from being a publicly-traded company as WPT Enterprises to a part of a larger entity. Black Ridge Acquisition Corporation acquired WPT Enterprises and Allied Esports International from Ourgame in China.
The two companies then combined to become Allied Esports Entertainment (AESE) to focus on the video gaming community and multiplatform content for esports and entertainment. The WPT’s part of the deal was to add its expertise in live events, content distribution, and customer engagement to the mix.
That entire deal was worth $213.8 million, with the WPT said to have been about $50 million of the deal. (Ourgame had acquired WPT Enterprises in 2015 for $35 million.)
Little more than two years after that transaction, Allied Esports Entertainment is offloading the World Poker Tour. Element Partners, which is a privately-held investment agent, agreed to acquire the World Poker Tour and all poker-related business assets for $78.25 million.
Element will pay $68.25 million up front. The balance will take the form of collecting 5% of WPT-branded tournament entry fees on Element-owned or licensed gaming platforms up to a maximum of $10 million. This payment plan must be complete within three years of the deal’s closing date.
Esports and Poker Not Compatible?
After the 2018 transaction, the goal was to overlap the esports and poker brands. Of course, some of that happened, as the WPT began filming some of its final tables at the Allied-owned HyperX Esports Arena in Las Vegas. With a few advertising and marketing-related exceptions, that seemed to be the extent of the overlap.
It appeared that Allied Esports was ready to offload the World Poker Tour to focus more specifically on esports. Allied may be looking for a merger situation or a buyer. Regardless, the goal is to use the capital from the sale of the WPT to explore strategic options for the esports arm of the business.
Allied Esports Entertainment CEO Frank Ng noted that the Covid-19 pandemic created numerous challenges for the WPT, though it still delivered “substantial, impactful results, specifically through its online platforms and services.” However, the esports business seemed to garner more momentum for esports alone.
Future of the World Poker Tour?
Meanwhile, the World Poker Tour is moving into unknown territory. The future of the WPT is primarily unknown to the public. And the public will remain in the dark, until the deal closes, which could happen in the next few weeks.
Allied’s board of directors approved the deal, which now turns it over to regulators and shareholders for their approvals. No one seems to expect any substantial opposition to the sale.
The WPT is bound by the terms of the deal and cannot reveal any details about what the future holds for the World Poker Tour. CEO Adam Pliska said, “My management team and I are excited about this next chapter and the tremendous new opportunities for the WPT brand and business.”
As the company continued its business as usual this week, it proceeded with slowly returning to live tournaments in America and scheduling online poker events for other parts of the world. Nothing else appears to have changed.
WPT Still Heading to Australia?
This is a big question with no answers yet.
When Aussies looked at the WPT schedule in November 2020, it still showed the World Poker Tour was scheduled for an appearance at the Gold Coast. The WPTDeepStacks Gold Coast festival was set for April 23 through May 3, with a $1,500 buy-in WPTDS Main Event starting on April 29 to highlight the series.
Around that same time in late 2020, Poker Media Australia interviewed WPT VP of Global Tour Management Angelica Hael, who said that the goal remained to schedule two or three stops in Australia each year going forward.
A look at the WPTDeepStacks schedule this week, however, shows that the Gold Coast spot on the schedule disappeared. This may have happened anytime in the past couple of weeks or months. However, we only noticed it when checking on the status of the Aussie events this week. WPTDS Gold Coast remains on the “upcoming events” schedule but not on the WPTDeepStacks page.
Most likely, everything will become clearer in February. If the deal closes as planned, the entities may announce the closing in the coming weeks, and the World Poker Tour executives will be free to speak freely about their plans, at least for the immediate future.
