PokerStars in Full Tilt buy-out rumours as Groupe Bernard Tapie drop out of the running
Wednesday, 25th April 2012
Rumours have surfaced regarding the potential purchase of Full Tilt Poker (FTP) by long-time rivals PokerStars, on the same day as the group previously leading the race to acquire Tilt announced they were pulling out of the deal.
Yesterday a user on poker forum Two Plus Two named PS<3FTP posted a message stating:
“PokerStars has reached an agreement with the US Department of Justice (DoJ) to buy FTP.”
The mystery informant went on to reveal that they had heard that the supposed deal would see all players completely refunded and both sites return to online operations.
In response to the growing rumours, PokerStars head of corporate communications Eric Hollreiser took to the operator’s corporate blog to state that, as the company were still in settlement discussions with the DoJ, they could not comment on any rumours.
The full message read:
“We've had a lot of enquiries and there's lots of speculation on the forums, so I wanted to address the PokerStars chatter. As you know, PokerStars is in settlement discussions with the U.S. Department of Justice.
As such settlement discussions are always confidential, we are unable to comment on rumors. As soon as we have information to share publicly we will do so.”
Shortly after the Two Plus Two forum post, French organisation Groupe Bernard Tapie (GBT), who had been involved in discussions with the DoJ with regard to buying Full Tilt, released a statement confirming the proposed deal was dead.
An initial agreement last November had outlined plans for GBT to acquire FTP’s assets via the US government. The assets were to initially be forfeited to the government, who would have sold them on to the Group for $80m.
The government would then have used the funds from the sale to pay back US players, with GBT responsible for the refunding of players outside the US.
The GBT statement began: “Groupe Bernard Tapie regrets to announce that, after seven months of intensive work, our efforts to obtain final approval of the United States Department of Justice in the agreement to acquire the assets of Full Tilt Poker have ended without success.”
The group said that the inability of the two parties to agree a plan for the repayment of ROW (Rest of the World, i.e. non-US, players) as well as “legal complications” surrounding the deal, had led to the collapse of talks.
GBT revealed they had proposed a system whereby all ROW players would have had their balances immediately reinstated, with the account owners given the right to withdraw those funds over time based on the size of a player’s balance and the extent of their activity on the re-launched site.
GBT say 94.9% of ROW players would have been repaid in full on the first day of Full Tilt’s re-launch, with the rest seeing their funds returned over a longer period of time.
However they claim that the DoJ made a “surprise demand in the 11th hour, after months of good-faith negotiations” that all players would have to be repaid within 90 days.
The “legal complications” related to the legality of the previously agreed forfeiture under non-US laws. GBT said they are wary that, due to all of FTP’s key assets residing outside of the United States, a non-US court could regard the forfeiture as a fraudulent transaction and declare it invalid or “deem the acquirer of the assets responsible for all of those creditor obligations”.
Commenting on the PokerStars rumours, the statement read: “We understand from press reports that the DOJ may have entered into an agreement with PokerStars pursuant to which PokerStars will acquire the FTP assets.
If accurate, we can only assume that PokerStars determined that it was willing to accept these legal and financial risks in order to resolve its own legal situation with DOJ.”
The statement ended with GBT saying that, in their view, the further consolidation of the online poker market by PokerStars was “probably not good for players and for the whole online poker industry”.