Bally’s offers to buy Allied Esports for $100 million
By Bob Garcia
Bally’s Corp. submits an unsolicited bid to acquire the major eSports organization
On Friday, an unrequested $100 million takeover offered by Bally’s Corp. was confirmed by Allied Esports Entertainment. If this deal goes through, Allied Esports would be longer able to sell a unit that owns the World Poker Tour (WPT) or any of its eSports operations. This offer doesn’t seem to be very well accepted by Allied Esports investors, due to the fact that the stock is currently down more than 22% in midday trading, making it not a really good offer. If we compare this offer with the California-based company’s market capitalization of $131.58 million, the reason why it is well below market value is self-explanatory.
Prior to this offer, the intention of a WPT sale was announced, so that’s also a reason why investors aren’t that excited since the sale would need to be scrapped if the buyout bid is accepted. According to a statement, it was said, “The Bally’s proposal would require the Company to terminate its previously announced agreement with Element Partners, LLC to sell 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 WPT for consideration totaling $78,250,000.”
As part of that figure, there is $68.25 million in cash and “fully guaranteed revenue share of 5% of WPT-branded tournament entry fees on Element-owned or licensed gaming platforms, up to a maximum of $10 million, payable over three years after closing.” The WPT sale was announced by Allied Esports earlier this year and the company expected to have everything done by the end of January or even early February, but still hasn’t been able to complete the transaction.