The negotiations between Full Tilt Poker and Group Bernard Tapie were broken off last week apparently over GBT’s insistence in being allowed more than 90 days in which to pay back all players. The U.S. Department of Justice seemingly felt that 90 days was an adequate time frame within which to accomplish full reimbursement.
However, GBT’s attorney, Behn Dayanim, claims that he told the DOJ in February that more time than three months would be required to make full repayment, PocketFives reported. Dayanim also added what everybody probably already knows, that “deals don’t come together in a few days.” In other words, PokerStars could not have been sitting idly by while the DOJ was in the midst of working out a deal with Tapie and Full Tilt. Then, when the deal fell through over the 90-day payback period, PokerStars moved in and made an offer for $750 million to acquire the assets of Full Tilt and pay back players in 90 days? Just like that an agreement was brokered after months of negotiations with GBT? Highly unlikely.
Was GBT negotiating in good faith while the DOJ was not? Was the Tapie Group used as a bargaining chip for the DOJ in their talks with PokerStars?
Business deals of this magnitude are very complex, especially when assets being acquired are still mired in legal proceedings. But it certainly seems quite fishy that Pokerstars would swoop in immediately after talks break down with GBT and have a deal in place to acquire Full Tilt. There had to be negotiations going on with PokerStars prior to the failed deal with Tapie.
GBT was in the process of acquiring a gaming license with the AGCC, had set up new subsidiary companies with Full Tilt names, and was undertaking massive hiring in preparation of relaunching. That’s quite optimistic in regards to whether they thought a deal was imminent. Common sense tells you that you wouldn’t commence with those actions without a strong likelihood that the acquisition would be successful.
Did GBT get played?
Although not an expert on business ethics, it certainly seems like Tapie got played by the DOJ on this deal. According to their lawyer, the DOJ knew two months ago that a 90-day payback period was unworkable. Maybe in secret negotiations between PokerStars and the DOJ that the public was not aware of, PokerStars agreed to this time frame and other considerations that made the deal with PokerStars better than the one with GBT, at least from the DOJ’s perspective. It certainly is better in the eyes of most poker players who will apparently be fully reimbursed within 90 days of a finalized agreement.
Only time will tell if PokerStars’ purchase of Full Tilt and their continued dominance in the online poker market will be good for the industry as a whole. We apparently will never know how the market would have shaped up with GBT running Full Tilt. However, something is not quite right with the way the negotiations suddenly broke off and all of a sudden its PokerStars to the rescue. It certainly looks as if Group Tapie may have gotten shafted on this deal.