Poker News Daily

Element Partners Acquires the World Poker Tour from Allied Esports in $78.25 Million Deal

Building cash for future opportunities

The World Poker Tour has its fifth home. On Tuesday, Allied Esports Entertainment announced that it has agreed to sell the WPT and its related assets to Element Partners LLC, a private investment company, for $78.25 million. The bulk of Element’s payment – $68.25 million – will be in cash, while the rest will come in the form of revenue sharing. Element will pay Allied Esports 5 percent of WPT tournament entry fees for three years, capping the total payment at $10 million.

Though Allied Esports CEO Frank Ng said that the World Poker Tour has had “substantial, impactful results” for his company, he added that the sale was a financially necessary move, saying, “Due to COVID-19’s impact on the Company’s overall revenue generation and profitability timeline, we believe the forthcoming sale of the WPT business will garner significant capital and an avenue to determine new opportunities that will deliver accelerated returns for our stakeholders.”

Interestingly, Allied Esports said in its Tuesday press release that the COVID-19 pandemic has raised interest in its esports business and thus it is considering selling that, too. In fact, it sounds like Allied is planning on selling it, since it also announced what will happen if and when it does. It will rename itself and become a holding company looking to buy companies in the “real money gaming and other sectors.”

If selling its esports vertical was just a “maybe, we’ll see,” I wouldn’t think that Allied Esports would be so explicit about its plans for after it divests that portion of the business. While it says there are ongoing negotiations and it does not have any offers right now, it certainly seems like this has been the plan all along.

WPT on the move yet again

This will be the fourth time that the World Poker Tour has been sold. It was founded in 2002 by Steve Lipscomb along with its parent company, WPT Enterprises (WPTE). PartyGaming bought the World Poker Tour in November 2009 for $12.3 million and two years later, merged with bwin to become bwin.Party Digital Entertainment (the reason why I mentioned that last part will be evident in a moment).

In 2014, the WPT partnered with Ourgame for a licensing deal in multiple Asian markets. Ourgame then turned around and bought the World Poker Tour from bwin.party in June 2015 for $35 million (there’s the reason – didn’t want there to be confusion over the company names).

Then, in late 2018, Ourgame sold both the WPT and Allied Esports to Black Ridge Acquisition Corp., a SPAC not coincidentally controlled by WPT co-founder Lyle Berman. Black Ridge changed its name to Allied Esports Entertainment and here we are today. Allied Esports CEO Frank Ng used to be CEO of Ourgame.

The World Poker Tour has been exclusively online for nearly a year because of the COVID-19, but it is in the midst of its first live stop since early March. With preliminary events almost done, the championship event of the WPT Lucky Hearts Poker Open starts on January 22 at the Seminole Hard Rock Hotel & Casino in Hollywood, Florida.

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