Wednesday, April 25, 2012

Seeing Stars, Tapie Taps Out

Stay TunedWe awake this morning to little new information regarding yesterday’s bombshell that PokerStars may be looking to purchase Full Tilt Poker as part of both sites’ efforts to reach some kind of settlement with the U.S. Department of Justice.

Several mainstream sites have picked up on the story by now, including the Wall Street Journal where Alexandra Berzon, having spoken to “a person familiar with the matter,” can confirm “PokerStars In Talks to Buy Full Tilt Poker.”

Those of us who have seen the new documentary All In: The Poker Movie recall Berzon as one of the many interviewed for the film. She reported on Black Friday and its aftermath for WSJ, and thus was able to fill in some details on that as well as share other interesting observations about Full Tilt Poker’s “bluffing” and the whole poker “boom” being manufactured (in part) by the online poker sites and their loose-aggressive marketing campaigns. I wrote a little about her comments in a post here a few weeks ago.

The unidentified person to whom Berzon spoke confirmed that the purchase “would be part of a broader settlement of a civil case brought by the DOJ against the two companies.” In other words, the civil complaint seeking money from PokerStars and Full Tilt Poker could be settled here; however, Berzon notes, “the deal would likely not affect criminal charges pending against the Full Tilt Poker and PokerStars executives not in the U.S., according to the person with knowledge of the matter.”

The rest of Berzon’s article fills in further background regarding the indictment, the civil complaint (and its later amendment), as well as a reference to past history when “PokerStars and Full Tilt were once fierce rivals.” That latter point was the one that dominated my thoughts about it all yesterday -- the fact that for so many years we saw Stars and Tilt as not just distinct but opposed to one another. For me, that was a context that made the thought of one acquiring the other so wild to contemplate.

Given Berzon’s experience covering the story, I’m going to assume the person to whom she spoke is a well placed source and that we can trust from her reporting that indeed something is going on with regard to these negotiations.

Interestingly, the abrupt failure of the Groupe Bernard Tapie bid has grabbed relatively less attention, despite the fact that the efforts of the French group to acquire FTP have been so closely documented and reported on over the last seven months. Never mind that with that story individuals from both GBT and FTP (with names) have come forward with statements about the failed deal.

Laurent and Bernard TapieI always thought that GBT sincerely wanted to acquire Full Tilt -- that is, they were serious about doing so -- but their offer and method of negotiation never seemed legitimate. Diamond Flush’s detailed breakdown of “The GBT Repayment Plan, Fact vs Fiction” (posted on her site late yesterday) chronicles in detail the group’s mostly unrealistic ideas about repaying “ROW” (rest of world) players. Seems like just one of several aspects of GBT’s negotiating strategy that indicate the deal was mostly doomed from the start, thanks largely to the buyer’s non-willingness to spend.

All along GBT never seemed like they were bringing much at all to the table. Was like they had come to buy something, but in reality Tapie was pretty much tapioca.

There was some talk yesterday floating around about the GBT-FTP deal having somehow fallen victim to “sabotage,” an idea first suggested by an early tweet by iGaming France stating that “Laurent Tapie confirms deal is off for FTP buyout, insinuates external sabotage over DOJ negociations [sic].” iGaming France’s follow-up article mainly shared Tapie’s official statement that the deal was off and brief explanation of the reasons why, including a last acknowledgement that a Stars-FTP-DOJ deal was apparently in the works.

It is that reference to the Stars deal that apparently “insinuates external sabotage,” the implication being the possibility of Stars stepping in here weakened GBT’s negotiating position to the point of ruining their candidacy as purchasers. Unlike GBT, PokerStars is able to offer a lot more for the purchase and thus also better able to repay all players (including those in the U.S.) as well as perhaps settle with the DOJ regarding civil charges. (That $750 million figure we saw ChiliPoker CEO Alex Dreyfus tweeting about early Tuesday is repeated in the iGaming France article.)

No ideer, of course, of the order of things or who has been talking to whom and when, but it seems a little cynical for a non-legitimate suitor to claim (or imply) “sabotage” when a legitimate one comes along to knock them out of the running.

Groupe Bernard Tapie, Full Tilt Poker, PokerStarsSort of like GBT was sitting at the table with some trash hand and was vainly trying to bluff Full Tilt Poker off a monster... you know, like K-K. (We have to give FTP pocket kings here, right?) Then PokerStars reraises with A-A, forcing GBT to give up on the hand. Yet GBT still complains while folding, as though they should have won somehow.

Am certainly intrigued to see how the rest of this plays out, as well as to discover ultimately Stars’ true purposes for striking such a deal -- which I’m sure we’ll all learn if and when it gets done.

Because unlike the amateurish GBT who always seemed like they needed to get lucky to win anything, PokerStars generally plays just about everything like a pro, with each move made for a specific reason, and as part of a larger plan.

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Blogger Random Table Draw said...

Nice breakdown. I hope this and the Wire-Act findings help them 'buy out' of their civil issues and get things into the new era of poker. I'm not saying "back to normal"...the old days were anything but normal.

4/26/2012 11:22 AM  

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