Less than a month after World Poker Tour Enterprises (WPTE) announced a buyout deal with Gamynia Ltd, news broke that the company received an alternative bid from PartyGaming, the parent company of popular online poker site Party Poker.
The original deal with Gamynia was worth $9 million, but the second bid from PartyGaming, worth just over $12 million, was substantially more lucrative and, as a result WPTE will be opting out of the Gamynia deal. In order to cancel the deal, WPTE will be using a cash advance from PartyGaming to pay a $1 million penalty.
The new PartyGaming deal allows the WPTE’s shareholders to retain their cash and other assets as well as future revenue stemming from their Season VII sponsorship deal with PokerStars. The deal also stipulates that PartyGaming will inherit the company’s existing television library and intellectual property rights to the various brands under the WPTE umbrella including the World Poker Tour (WPT) and Professional Poker Tour (PPT). According to a statement from PartyGaming, the agreement consists of a “cash consideration of $12.3 million and an ongoing revenue share relating to the purchased assets under which PartyGaming will make a minimum aggregate payment of $3m over the next three years.”
The board of directors of WPTE does not intend on distributing the money from the sale to PartyGaming and will instead use that money in tandem with their retained liquid assets in order to invest in a new company outside of the poker industry.
WPTE co-founder and Chief Executive Officer Steve Lipscomb commented on the new deal in a statement released on Monday. “PartyGaming has been an important partner for a number of years and we are confident that they will be an excellent manager of our brands in the future”, said Lipscomb. “The Board of Directors has determined that PartyGaming’s acquisition proposal is financially superior and we look forward to working with one of the pioneers and leaders in the poker and online gaming markets to provide a strong vehicle for the WPT brand to continue its global expansion and return to online gaming.”
Many poker insiders are already speculating on the implications of this new business agreement and whether or not Party Poker will open its doors to US customers. Party Poker pulled out of the US online poker market in 2006 following the passage of the Unlawful Internet Gambling Enforcement Act (UIGEA). In PartyGaming’s year end report for 2008, PartyGaming Chief Executive Officer Jim Ryan told shareholders the company would be exploring the possibility of returning to the US market should the legal status of online poker in the States change in the near future.
PartyGaming made big news in April of this year when they announced a settlement with the United States Attorney’s Office (USAO) in which they would pay the US government $105 million over the next four years and, in turn, the USAO would not prosecute the company for business transactions conducted in the States prior to the passage of the UIGEA.

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