Bally’s Nabs World Poker Tour as Allied Esports Deems Revised Takeover Offer Superior
Posted on: March 16, 2021, 07:55h.
Last updated on: March 16, 2021, 09:27h.
Bally’s Corp. (NYSE:BALY) is getting its hands on the World Poker Tour (WPT), as Allied Esports Entertainment (NASDAQ:AESE) said the casino operator’s offer for that unit is better than a previously accepted proposal from Element Partners, LLC.
California-based Allied said today a revised offer for WPT from Bally’s tops the offer from Element that the seller accepted in January.
“Under the terms of Bally’s revised proposal, Bally’s would acquire all of the equity interests of Club Services, Inc. (CSI), an indirect, wholly-owned subsidiary of the Company that directly or indirectly owns the Company’s poker-related business and assets, including the entities comprising the World Poker Tour, for consideration totaling $90 million in cash at the closing,” according to a statement.
Earlier this month, the Rhode Island-based casino operator made an unsolicited $100 million bid for Allied. But that offer was for the entire company and based on the premise the target would scrap the planned sale of WPT to Element.
On March 5, the day that offer became public, shares of Allied plunged 25.38 percent, because the Bally’s pitch was $31.58 million below the WPT owner’s market capitalization entering that day.
If Allied Esports accepted the $100 million pitch, it could have taken Bally’s equity, cash, or a mix of the two.
What’s Next for Allied, WPT
While Allied states, “There can be no assurance that the company will enter into a definitive agreement with Bally’s or consummate any transaction with Bally’s,” it appears the casino company will get its hands on WPT unless Element counters with a larger offer.
Allied “notified Element that it intends to terminate their stock purchase agreement unless, prior to 5:00 p.m. Pacific Time on March 19, 2021, the Company and Element negotiate an amendment to their pending stock purchase agreement such that the Bally’s revised proposal no longer constitutes a Superior Proposal,” according to the statement.
The esports company went public in August 2019 following a merger with a special purpose acquisition company (SPAC) Black Ridge Acquisition Corp. Because of budding excitement for esports, there was enthusiasm for Allied, which created the Esports Arena at the Luxor Hotel on the Las Vegas Strip.
However, the stock tumbled immediately following its debut, and rebound efforts were hindered last year. That’s after a plan to put esports locations in malls owned by Simon Property Group suffered setbacks, as those venues were temporarily closed because of the coronavirus pandemic.
Shares of Allied Esports are up almost 77 percent this year, but the stock resides below $3. It traded around $6 when the SPAC transaction was announced in August 2019.
Bally’s Acquisition Spree Continues
The offer for WPT extends Bally’s run of dealmaking aimed at bolstering its portfolio of online gaming and sports wagering offerings.
After doling out $125 million to buy sports betting technology provider Bet.Works last November, Bally’s announced the purchases of daily fantasy sports operator Monkey Knife Fight (MKF) and free-to-play games firm SportCaller since the start of this year.
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