Full Tilt Poker Sold?
Wicked Chops Reporting Bitar Ousted as Full Tilt Poker Boss
Here is the link to the Wicked Chops article.
If you’ve been following my posts on 2+2 on the Full Tilt situation, this report will not surprise you. As I explained on July 1 in the thread on the Los Angeles Times report, there aren’t very many plausible scenarios in which Bitar can remain as head of Full Tilt Poker.
Wicked Chops has published good information before, so there is a decent chance this report is accurate. I actually am not sure they got all the details right, though. Mainly, I question whether Bitar was “voted out” as the article says, or whether he resigned in connection with a surrender of his shares in exchange for the as yet unnamed investor buying into the company. How this might happen would be governed by the membership agreements of the various entities that make up Full Tilt, but it seems most likely to me that Bitar’s shares have to be transferred out of his control.
Even if Wicked Chops’ information is inaccurate, and Bitar is not ousted, it is just a matter of time before that happens. I really just think there is no way Full Tilt can go forward with him having an ownership interest in the company.
If Wicked Chops is correct that Bitar is gone, that’s good news for another reason: it increases the probability that the other half of its report is correct, and that the Alderney Gambling Control Commission is poised to unsuspend Full Tilt’s license and allow play to resume at Full Tilt.
Assuming it is actually occurring, these two events are clearly related. It looks like exactly the scenario I described back on July 1 in two posts I made in the legislation forum thread on Alderney suspending Full Tilt’s license:
Pure speculation:
It looks like two things have been going on simultaneously. First, FT has been discussing a sale with various parties. second, FT was under an AGCC imposed deadline to come up with a plan to pay back players. It looks like AGCC knew of the talks and had imposed a deadline of yesterday, FT blew the deadline, AGCC lowered the boom, and everybody involved in the deal scrambled to put it together today before the value of the asset being sold was wrecked by the suspension.
Good news.
and:
I don’t think the deal is finalized yet. I think they busted their asses to get it far enough a long that they could tell a reporter “we have a deal,” and so that they can go to AGCC and say, “look we have a deal, lift the suspension.”
If the suspension gets lifted before 7/26, we’ll basically know that is exactly what happened.
On July 5, in its media release, the Alderney Gambling Control Commission basically affirmed my July 1 analysis on 2+2, when it announced that it was in talks with Full Tilt and a third party to refinance Full Tilt so that its license suspension could be lifted.
If Wicked Chops’ report is right, then it looks like things are playing out exactly as I predicted they would on July 1: That Bitar is out, and that the suspension was the result of FT having been under an AGCC imposed deadline to refinance by the 29th, that they missed the deadline, got suspended, and then rushed the deal into place after the suspension so they could reopen as quickly as possible.
If this is how things played out, 2+2 members owe a huge apology to AGCC. AGCC has faced a lot of criticism on 2+2 for being half-assed regulators and not having done anything post-Black Friday. If we wind up with an investor who is buying in by paying off US players, it is starting to look like AGCC will have played a key behind-the-scenes role in making that happen.
It’s too early to tell right now, but if Wicked Chops is right, AGCC would be entitled to the thanks of the poker community.
Reports Surfacing Questioning Whether Full Tilt Sold to Investors
from CalvinAyre.com:
About an hour after the story broke, WickedChopsPoker tweeted that the Times were “jumping the gun a bit with their story…” but provided no further details. CalvinAyre.com reported earlier Thursday that a source had told us bwin.party principals Norbert Teufelberger and Jim Ryan had offered Bitar $185m to acquire FTP but rescinded their offer following the Alderney Gambling Control Commission’s decision to suspend FTP’s license.
There is also a post in the NVG thread on the LA Times report that says Durrr tweeted that the deal was not complete. I’m pretty new to twitter (brag!) but I can’t find such a tweet by Tom Dwan.
The NVG post also says Doyle says it isn’t a done deal, but all Doyle said was he wouldn’t make a big bet on it.
My personal take on the CalvinAyre.com report is that it has some pretty detailed facts in it that lend it credibility, but the fact that the buyers would bail out immediately rather than try to deal with the license suspension strikes me as a little too impetuous a decision when a $150 million bargain is on the table.
Full Tilt Poker Sold–But to whom?
As I have mentioned on 2+2, there is an unsourced rumor floating around in NVG that BWin (Party) is the party to whom Full Tilt sold control.
I’m not sure I believe that, but if it is true, it is a good news bad news situation for players.
It is good news in that BWin is a big, publicly traded corporation that has (or can easily acquire) the assets and liquidity to pay US players pretty effortlessly.
It is bad news because, as a publicly traded corporation, BWin will probably have to jump through some time consuming hoops to get the deal approved. So we could be in for a long wait if it is actually BWin to whom Full Tilt Poker sold control.
Los Angeles Times: Control of Full Tilt Sold to Unnamed Investors
Now I’m just going to brag a bit. In the QuadJacks thread saying Binion had invested in Full Tilt, this is what I wrote 10 minutes before the LA Times story broke:
The far better option for an investor is to discuss the acquisition with the DOJ. DOJ is likely to settle for a lesser amount of money if it results in players being made whole and the current owners of FT being kicked out of the company.
In fact, such a sale would probably be structured as
Investor: “I, white knight, agree to pay X for ownership of FT, sale price to be paid to the United States in settlement of its case against FT’s owners.”
FT: “We relinquish to white knight all right, title and interest in everything relating to FT in settlement of the case against us.”
US: “We agree to dismissals of some combination of the criminal and civil cases, and maybe we will speak kindly of the white knight to future US poker regulators considering his license application.”
Obviously bare bones silliness above, lots of other things the parties would be negotiating. Main point being that under the circumstances, an investor is pretty likely to be paying the sale price to the US, not the FT owners. If i were investing, that’s what I’d be shooting for.
I don’t usually just brag, but I am pretty pleased that I more or less nailed the structure of a deal being secretly negotiated. The LA Times article says pretty much what i said the deal would look like:
Attorneys associated with Full Tilt said the company signed an agreement Thursday with a group of investors who would put up enough money to pay back players and in doing so attain a majority stake in Full Tilt’s Irish parent company, Pocket Kings. The attorneys spoke anonymously because of the sensitivity of ongoing negotiations with the federal prosecutors in Manhattan who brought the charges.
The money is also intended to allow the company to settle a civil lawsuit brought against it by the U.S. attorney’s office at the same time as the criminal indictment, the attorneys said.
As I said would happen, the investors made sure that the DOJ was involved in the talks. refunding players seems to have been an explicit condition of the deal, and it looks like the deal is being negotiated within the framework of the civil and criminal cases against the Full Tilt owners.
If anybody is wondering who the LA Times’ source is, it is pretty clear that the ultimate source is Howard Lederer. Here is why I think that:
1. It was the LA Times that broke the story;
2. Tiltware is based in California.
3. Howard is probably the only one in Tiltware with the authority to cause the story to be leaked.
4. The actual source were “lawyers associated with Full Tilt.”
5. An attorney told to leak a story will leak it to a local reporter he knows.
All of this adds up to Lederer telling his attorneys in LA to leak the story to the press, and the attorneys calling the LA Times.
Obviously the report is excellent news for all US players.
Folks on 2+2 are incorrectly crediting the Alderney Gambling Control Commission with forcing this deal by suspending Full Tilt’s e-gambling license yesterday. This is wrong. There is simply no way that this deal got put together in the 30 or so hours between the suspension and the news report today.
A better theory that credits AGCC more or less equally is that AGCC gave Full Tilt a June 29 deadline to have a plan in place to pay back players, and FT blew the deadline by a little bit. The suspension probably caused news of the deal to leak more quickly than FT intended, but it didn’t cause the deal to happen. This deal was necessarily in the works for a long time–at most the suspension affected the timing of the leak we see in the LA Times story.