Under the terms of the agreement, Element will acquire WPT for $78.25m, consisting of a $68.25m upfront payment and a fully guaranteed 5% revenue share of WPT-branded tournament entry fees on Element-owned or licensed gaming platforms, up to a maximum of $10m payable over three years after closing.
Allied’s board of directors has approved the transaction which is expected to close in late January or early February this year, assuming the company’s shareholders approve the transaction and subject to the required regulatory approvals and other customary closing conditions.
Allied’s board has also agreed to explore strategic options for its esports business, following the rapid growth and popularity of gaming and esports during the novel coronavirus (Covid-19) pandemic, it said.
Options include a possible sale of the business and the company has engaged Lake Street Capital Markets to assist with the process. Presently no particular buyer has been identified and there are no ongoing negotiations relating to the sale of the esports business.
Upon completion of the WPT transaction, and if a sale of the esports business goes ahead, Allied said it would proceed under a new name as a publicly traded holding company, focused on using its cash resources to explore opportunities in online entertainment including real money and other gaming sectors.