Third party expected to acquire Atlantic Club following PokerStars termination3rd May 2013 6:30 am GMT
Insiders are expecting a third party to gazump PokerStars in its attempted acquisition of New Jersey’s Atlantic Club casino.
The Atlantic Club could be leaving itself open to litigation if it has made certain assurances to PokerStars regarding the deal, say lawyers.
The deal was always contingent on PokerStars receiving licensure from the New Jersey authorities and it is understood that the casino was being kept up to date about what was becoming a lengthy process.
Just last week, many of PokerStars’ key executives were at the GiGse conference in San Francisco and all were expecting the deal to go ahead.
Numerous reports claim the deal expired last week but sources suggest the casino was fully aware this would happen and one even suggested the casino’s representatives wrote to PokerStars to assure it that it wanted the deal to go through despite the delays.
Such a letter would leave Atlantic Club exposed to a PokerStars claim for damages and costs unless a third party was to come in and buy the company and indemnify them against such actions.
Atlantic Club CEO Michael Frawley declined to comment but released a statement on Wednesday saying: “Our purchase agreement with PokerStars has been terminated. The Atlantic Club remains committed to the aggressive pursuit of the opportunities presented by online gambling.”
PokerStars has kept completely silent since reports started to surface that the deal was falling through. The company’s silence could be due to frantic efforts to resurrect the deal or due to the preparation of a legal strategy.
The director of the state Division of Gaming Enforcement David Rebuck told the Press of Atlantic City: “It’s between the parties. They have to work out their agreement. But I’m not worried about this casino or any other casino closing. Because of the internet wagering law being passed, there are more interested buyers in Atlantic City than ever before. I’m feeling very good about 2013 and keeping all of the casinos open.”
Politicians were split on the fallout from the deal’s demise.
The driving force behind New Jersey’s iGaming efforts Senator Ray Lesniak said: “Unless the Atlantic Club can find a white knight to invest in its operations, there are going to be a couple thousand people out of work, which will also have a broader impact on Atlantic City’s recovery. I hope there’s a Plan B.”
However, Assemblyman Ralph Caputo was pleased: “PokerStars’ interest in Atlantic City casinos was disconcerting, to say the least, for many New Jerseyans. PokerStars is a firm with a sordid history of criminal accusations of illegal gambling, money laundering, bank fraud, wire fraud, and its founder remains under federal indictment for these charges.
“The firm’s way of conducting business threatened to undermine the integrity and public confidence that Atlantic City has worked diligently to build since the enactment of the New Jersey Casino Control Act enacted in 1977.”