Jackpot Digital announced last week that it has reached an agreement with Multimedia Games, Inc. to purchase the company’s PokerTek business unit. The deal is worth $5.4 million, but may increase to as much as $7.5 million if the terms of an earn-out formula are met. An earn-out, in a nutshell, is a deal in which the seller gets paid more if the business that is sold performs up to some agreed-to financial goal after the sale.
PokerTek is best known for developing the PokerPro computerized poker table, a table that merges internet poker with physical poker. It is, for lack of a better term, a pretty cool product. PokerPro tables are the same size and shape as normal poker tables, but at each seat, there is a touch-screen computer monitor embedded in the felt. No physical chips or cards are used. Similar to online play, bets are placed on the screens and each player’s hole cards appear on their individual monitors. A larger monitor in the middle of the table displays the community cards and other information like pot size for all to see.
Hole cards are dealt face down as they normally would be; in order to see them, players cup their hand(s) around the cards. They then peel up just like real cards would, out of sight of opponents. PokerPro tables have distinct benefits for a card room: as everything is automated, there is no need to pay dealers, and barring some sort of unforeseen glitch, there should never be any sort of player or dealer error when it comes to counting chips, distributing the pot, or acting out of turn. And as there is no need to shuffle real cards or move around chips, hands are dealt much faster, just as they are online.
When the automated tables were first introduced about a decade ago, there were a lot of people who were dead-set against them, as they didn’t feel like “real” poker. People wanted the tactile sensation of physical chips and cards and, of course, some people assumed that the games would end up rigged somehow because COMPUTERS. In time, though, the PokerPro tables have become more accepted and have found their niche, particular in smaller card rooms and on cruise ships.
In a press release, Jackpot Digital’s President & CEO Jake Kalpakian said:
In addition to being located at land based gaming venues, the electronic tables are used extensively on cruise ships where our mobile games are already played. By merging the Company’s current proprietary gaming platform with the assets that are being acquired, the Company expects to increase revenues significantly. Moving forward we can build unique features and products that synergize between the electronic tables and mobile games, leading to a superior user experience and ultimately increased revenues for the Company.
PokerTek was originally an independent company, but was acquired by Multimedia Games in an agreement announced in April 2014 for $13.5 million. The sale closed in October.