By Joe Zusman | October 31, 2009

Just as folks in the poker world were considering the sale of World Poker Tour Enterprises (WPTE) to PartyGaming to be a done deal, entertainment company Mandalay Media Inc swooped in with a last minute bid to purchase the company for $36.5 million.

Mandalay’s offer is almost three times that of the $12.3 million bid made by Peerless Media (aka PartyGaming) and promises cash payment to the shareholders of WPTE. According to a press release from Mandalay Media, shareholders would receive, “cash and stock of $1.69 per share.” The current agreement with PartyGaming provided no such payout and would instead use the money from the sale to invest in a non-poker related business venture. A letter drafted by Mandalay Media Co-Chairman Robert Ellin proposed a sale that would give WPTE shareholders $5 million in Mandalay Media stock plus $28.5 million in cash and, “perpetual revenue participation rights, guaranteed to be at least $3 million.”

The WPTE Board of Directors was scheduled to come together Friday for a Special Meeting to vote on the proposed deal with Peerless Media/PartyGaming. Mandalay Media’s Board of Directors encouraged WPTE to postpone the meeting in order to take time to adequately consider the new offer, Poker News Daily reported that the shareholder meeting continued as scheduled.

This last minute bid feels a bit like déjà vu since this is not the first time that WPTE has considered backing out of a sale agreement. WPTE and the Playtech subsidiary Gamynia Ltd reached a sale agreement worth just over $9 million back in August, only to have WPTE back out when PartyGaming came along with their superior offer. As part of the deal, PartyGaming agreed to front the money for the $1 million penalty WPTE was required to pay for backing out of the Gamynia deal.

Mandalay Media is a media company that publishes and distributes new media content and Ellin believes their resources and presence in the social media marketplace can help boost the appeal of WPTE. In his letter to the Board of Directors, Ellin suggested tapping into Facebook, creating content for mobile media platforms and utilizing Mandalay’s strategic relationships as just a few of the ways the company can enhance the WPTE name. Ellin also presumed legalized and regulated online gambling is imminent and proposed Mandalay’s Play for Prizes platform as a means to immediately transition into the realm of online gambling if and when the laws change.

The Board of Directors at Mandalay has already approved the proposed sale, but there has yet to be any sort of formal announcement from WPTE in the matter. Both companies are publically traded, with WPTE trading on NASDAQ under the symbol WPTE and Mandalay trading on the OTC Bulletin Board under the symbol MNDL.

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