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Mandalay Media Incorporated Bids for the World Poker Tour

Just as the final details were being place on an agreement to sell the world poker tour (WPT) to a subsidiary of PartyGaming, a 3rd offer to acquire the organization has been made. At the start of August 2009, Gamynia Limited agreed to pay $9,075 plus a portion of future earnings for almost all of World Poker Tour Enterprises assets including its distribution, marketing, television and licensing units.

The agreement was put on hold pending the approval of WPT's stockholders and in the interim another offer was made for the group. SEC guidelines required the group to consider the new buyout offer and in late August 2009, the World Poker Tour announced that it had accepted the offer. This time, the buyer was PartyGaming's subsidiary, which also owns the online poker site, PartyPoker.

The agreement was similar to the offer of Gamynia, except the subsidiary, Peerless Media Limited had agreed to pay $12.3 million for the group's assets and five percent of future gaming and other revenues.

The third offer was made on October 30th, 2009 during a World Poker Tour shareholders meeting to evaluate the offer of Peerless Media. The new offer came from Mandalay Media Incorporated, a worldwide publisher and distributor of branded entertainment for 3G mobile networks.

The proposal seeks to acquire the World Poker Tour for a total of $36.5 million, consisting of $28.5 million in cash, $5 million in Mandalay Media stock and perpetual gaming revenue participation rights, which guaranteed to be at least $3 million.

Mandalay Media said that the estimated value to shareholders is $1.77 per share or approximately sixty-one percent over the closing price of World Poker stock as of October 26th and close to twenty-eight percent more than the offer of Peerless Media.

While both the Peerless Media and Gamynia offers appeared to include plans to bring the World Poker Tour brand further into the online gaming market, a letter to the World Poker Tour shareholders from Mandalay Media stated that its plan is to move the World Poker Tour into mobile and web prizes game play until the legal problems with online gaming in the US is resolved. Existing SEC guidelines require the World Poker Tour to now evaluate this latest buyout offer.

12/02/2009, Wednesday
Matthew Dorst

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