When you have two invitations to the prom
When Element Partners agreed to acquire the World Poker Tour from Allied Esports in January, the companies said that they expected the deal to close later that month or in early February. Element is probably kicking itself right now that it didn’t happen, as Bally’s not only approached Allied with an unsolicited offer a couple weeks ago, but has now revised said offer to the point where Allied is likely going to accept it.
On Tuesday, Allied Esports announced that Bally’s new offer was to buy Club Services, the subsidiary that owns Allied’s poker business, including the World Poker Tour, for $90 million cash. Allied said that its Board of Directors considers this a “Superior Proposal” to Element’s, which seems to mean that Allied can back out of its agreement and go with Bally’s.
And that’s what it appears will happen. In a press release, Allied Esports said that Element has until 5:00pm Pacific to improve its offer. If not, Allied will cancel the agreement and go with Bally’s. Allied did throw in the disclaimer, “There can be no assurance that the Company will enter into a definitive agreement with Bally’s or consummate any transaction with Bally’s,” but that’s just a CYA move. It’s going to happen.
Lots of movement in a short time span
To go back through the two month history of the World Poker Tour custody battle, Element and Allied actually agreed to a WPT sale on January 19. In the deal, Element was to buy the World Poker Tour and the rest of Allied’s poker business for $78.25 million. Of that, $68.25 million would be cash. The other $10 million would be spread out over three years, collected from a 5% share of WPT entry fees.
So that was it, the sale was announced and that was that. But on March 5, Allied issued a press release, saying that Bally’s Corporation made an unsolicited offer to buy the entirety of Allied Esports for $100 million. Including the WPT was a requirement, so that meant that Allied would have to back out of its deal with Element.
Then, on Tuesday, Allied announced Bally’s revised offer of $90 million for only the Club Services subsidiary, which for all intents and purposes means the World Poker Tour. And by the sounds of the press release, it certainly seems like Allied Esports intends on accepting this offer, barring a juicier proposal from Element in the next couple days.
That would leave Allied with just its esports business. In January, the company said it had received interest from suitors in that portion of the company, so one might expect it to make a move sometime in the near future.