WPT Enterprises, Inc. (Nasdaq: WPTE – the “Company”) today announced
that Gamynia Limited (“Gamynia”), a company which forms part of a
privately held investment group with substantial holdings in a range of
diversified assets, has agreed to acquire substantially all of the
Company’s operating assets other than cash, investments and certain
excluded assets. Gamynia will pay the Company $9,075,000 plus a
percentage of future revenues earned by Gamynia from the World Poker
Tour® and Professional Poker Tour® brands.
Under ownership of Gamynia, the World Poker Tour and Professional Poker
Tour brands will continue all operations including the Company’s
television, sponsorship, distribution and licensing units and will under
the agreement enter the online gaming market. Gamynia has secured the
services of an industry leading online gaming marketing company Hardway
Investments Ltd. which will seek to exploit and develop the WPT brands
with the goal of maximizing future revenue opportunities.
Under the asset purchase agreement, the Company will sell its television
library, including all related intellectual property rights, brand
names, trade names, certain assumed contracts and tangible personal
property. Gamynia will assume specified liabilities including one of the
two corporate leases. The Company will retain its cash and cash
equivalents, investments in debt securities and put rights, certain
other investment and litigation assets, and future foreign sponsorship
revenues from the sponsorship of Seasons Four, Five and Six of the World
Poker Tour and Season One of the Professional Poker Tour by PartyGaming
and the license of Season Seven of the World Poker Tour to PokerStars.
The Company will also retain certain office lease obligations and all of
its employee obligations.
The net cash proceeds from the asset sale will be retained by the
Company and the Company plans to use the cash to develop or acquire a
non-poker related business. The Company does not currently intend to
distribute any proceeds from the asset sale to the Company’s
stockholders.
Closing Conditions and Stockholder Approval
The asset purchase transaction is subject to specified closing
conditions. The obligation of Gamynia to complete the transaction is
subject to the absence of changes or circumstances that are materially
adverse to the Company’s financial condition, assets, business or
results of operations and other customary closing conditions. The
Company’s obligation to complete the asset sale is subject to the
approval by the Company’s stockholders of the asset sale transaction and
other customary closing conditions. The Company and Gamynia currently
expect to complete the transaction in the fourth quarter of 2009.
The transaction must be approved by a majority of the holders of the
Company’s outstanding common stock. To that end, and as described
further below, the Company expects to hold a special meeting of
stockholders and in connection therewith to mail a proxy statement to
its stockholders that will provide additional information concerning the
asset sale transaction and the asset purchase agreement. Certain
significant Company stockholders, representing approximately 39% of the
Company’s common stock, have entered into voting agreements committing
to vote in favor of the asset sale transaction to Gamynia.
“We believe this transaction will enable the World Poker Tour to realize
its full potential across both its existing businesses and the lucrative
online gaming market. Gamynia and its partners possess highly
complimentary resources which will help it invest in and effectively
integrate with the World Poker Tour efficiently and profitably,” said
Steve Lipscomb, President and CEO of WPT Enterprises.
“The World Poker Tour was the catalyst for the 2003 poker boom in the
United States that quickly gave rise to a global poker phenomenon. The
massive international business markets that have evolved from that
phenomenon have been dominated and driven by the lucrative online gaming
business. The World Poker Tour as a stand-alone entity has struggled to
find the appropriate place for its stockholders in this fast evolving
market. The World Poker Tour brand continues to grow around the world
and has managed to make casinos and online gaming concerns cooperate in
unique and mutually beneficial ways. In Gamynia, we have found a partner
that already understands and fosters a spirit of cooperation in the
online marketplace. We believe that Gamynia and Hardway Investments Ltd.
are uniquely positioned to join with our current partners and guide the
World Poker Tour brands to fulfill their potential in the global poker
marketplace. Our Board of Directors believes that WPTE shareholders will
derive more benefit from the WPT and PPT brands in cooperation with
these significant online gaming entities. Of particular importance for
our partners is the fact that Hardway Investments has an established
track record of creating revenues and value in the online gaming
marketplace. We should benefit for many years from our participation in
those revenues streams. After the transaction, WPTE will move forward
under a new name and will employ our cash in a new venture by developing
a new business or combining, through one or more strategic transactions,
with companies that have significant unrealized value or growth
potential” said Steve Lipscomb, President and CEO of WPT Enterprises.
Important Additional Information about the Asset Sale will be filed
with the SEC
The Company plans to file with the U.S. Securities and Exchange
Commission (“SEC”) and mail a proxy statement to its stockholders in
connection with the asset sale transaction and the asset purchase
agreement. The proxy statement will contain important information about
the Company, Gamynia and the guarantor of Gamynia’s obligations,
Borucoral Limited, and related matters. Investors and security holders
are urged to read the proxy statement carefully when it is available.
The Company’s investors and security holders will be able to obtain free
copies of the proxy statement and other documents filed by the Company
with the SEC through the website maintained by the SEC at www.sec.gov.
In addition, the Company’s investors and security holders will be able
to obtain free copies of the proxy statement by contacting WPT
Enterprises, Inc., Attn.: Investor Relations, 5700 Wilshire Blvd., Suite
350, Los Angeles, California, 90036 or by calling 323-330-9900.
The Company and its directors and executive officers, may be deemed to
be participants in the solicitation of proxies with respect to the asset
sale transaction and the asset purchase agreement. Information regarding
the Company’s directors and executive officers is contained in the
Company’s Annual Report on Form 10-K for the year ended December 28,
2008 and its Proxy Statement dated March 31, 2009, which were filed with
the SEC.
About WPT Enterprises, Inc.
WPT Enterprises, Inc. is one of the most recognized names in
internationally televised gaming and entertainment with brand presence
in land-based tournaments, television, online and mobile. WPTE has led
innovation in the sport of poker since 2002, when it ignited the global
poker boom with the creation of the World Poker Tour television show.
Based on a series of high stakes poker tournaments, the World Poker Tour
is now broadcast globally and is currently filming its all-new eighth
season for broadcast on Fox Sports Net’s national sports network in the
United States. WPTE also offers a unique online subscription and
sweepstakes-based poker club, ClubWPT.com, which operates in 38 states
across the U.S. WPTE also participates in strategic brand license,
partnership and sponsorship opportunities. For more information, see www.worldpokertour.com.
(WPTEG)
Safe Harbor for Forward-Looking Statements
The Private Securities Litigation Reform Act of 1995 provides a "safe
harbor" for forward-looking statements. Certain information included in
this press release (as well as information included in oral statements
or other written statements made or to be made by executive officers or
directors of the Company) contains statements that are forward-looking,
such as expectations about the asset purchase agreement, the retention
of the net cash proceeds by the Company, the timetable for completing
the transaction, the ability to enter into one or more strategic
transactions to combine with another company, future revenues earned by
Gamynia with the brands and the Company’s participation in the future
revenues, and the proxy statement to ask Company stockholders to approve
the asset purchase agreement. Such forward-looking information involves
important risks and uncertainties that could significantly affect
anticipated results in the future and, accordingly, such results may
differ from those expressed in any forward-looking statements made by or
on behalf of the Company. These risks and uncertainties include, but are
not limited to, the risk that the Company’s stockholders do not approve
the asset purchase agreement, the risk that the asset sale is not
closed, the risk that the Company does not acquire or develop another
business using the cash proceeds from the asset sale, and the risk that
Gamynia does not earn significant future revenues with the brands and
that the Company does not participate in the future revenues. For more
information, review the Company’s filings with the SEC.
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