The World Poker Tour will focus on growth in Japan and South America after their owners Ourgame International outlines plans to raise HK$416m through a subscription share scheme that also involves growing their esports business.
Is poker dead?
Ourgame International Holdings Limited doesn’t think so.
The Hong Kong-listed online games operator are planning to raise HK$416m through a subscription share scheme in a bid to expand the reach of the World Poker Tour (WPT) and Allied Esports International (AES), Inc., and grow their core products in China.
Let’s begin with the WPT.
Ourgame bought the WPT from bwin.party for $35m back in 2015. Initially, not much changed. The core focus of the business remained North America with a few pit stops in mainland Europe.
Recently, there has been a hive of activity.
At the beginning of August, the WPT announced plans to host a WPT Japan in Tokyo. It was a surprising move given the gambling instability in the region. There are no cash prizes on offer, which tells you something of the nature of the beast. And more recently the WPT has announced three South American events in Brazil, Argentina, and Uruguay.
Of the HK$416m raised through the subscription shares model, 15% (HK$62m) will be used to grow the WPT business in both Japan and South America. The moves give the poker world a clear indication that their intel shows that both regions are prime for a surge of poker interest as long as gambling legislation doesn’t get in the way.
Of the HK$62m split, HK$25m is earmarked for WPT online products and TV content development in Japan and South America, with Brazil the epicentre of the Latin investment. HK$37m is going towards playWPT in the US, Europe and South American markets. The shares listing also detailed ‘potential strategic partnerships with key global partners’ without naming any names. Expect the changes in 2018 & 2019.
30% of the money (HK$125m) will be used to expand the presence of their esports interests via AES. The subsidiary plans to build ten esports arenas with between two and four of them made in China, with four to six erected in the US, with the first currently being constructed in the Luxor on the Las Vegas Strip. There are also plans to build two more mobile esports arenas for use in China. The European esports arena “Big Betty’ is currently in Holland as part of the WPTDeepStack in Valkenburg, where AES and the WPT are working as a cohesive unit for the first time.
The other 45% (HK$187m) will beef up OurGame’s core mobile product portfolio and acquire or create two to three local card and board games to complement their current library of products. No agreements have been reached at present, but the group expects to spend HK$40-Hk$45 per acquisition. 10% or HK$42m of the share money will be used to replenish working capital.