World Poker Tour dips as bid evaporates - Tuesday 12th of July 2005

A company spokeswoman said WPT, which owns the popular World Poker Tour television series, spoke to Brunson late Monday, who indicated he would provide no further information about the vague cash offer that was received last Thursday.

The offer represented a 100 percent premium to WPTs closing price on Thursday, when the market valued the company at about $357 million. It priced WPT shares at about $36.50 each.

"We expect the bid to expire at 5:30 p.m. today with no further action taken. Its back to business," she said.

The company said it had tried repeatedly to get information about the offer, but Brunson declined to give more details. The spokeswoman said she did not know whether Brunson had failed to secure financial backers or why he made the bid.

But analysts questioned the credibility of the offer, which triggered a 50 percent surge in California-based WPTs Friday share price on Nasdaq to a new closing high of $26.50.

Since then, the shares have slipped, dropping 5.3 percent to $21.98 on Tuesday after falling 12.5 percent on Monday.

Analyst Steven Gart from San Francisco-based Langner & Co., which focuses on small cap investors, said some were calling the offer a "pump and dump" but stressed the potential of WPTs online gaming operations that it launched two weeks ago.

"We feel that shares will continue to be weak as it now appears; perhaps there isnt anything tangible behind the Brunson bid," he said in a client note. "We would be buyers at the $18-$19 level based on our fundamental analysis."

Shares in WPTs largest shareholder, casino operator Lakes Entertainment Inc., which holds a 62 percent stake, has also had a rollercoaster ride on the back of the offer.

Lakes shares rose almost 22 percent on Friday to $18.09 before falling 11 percent on Monday and 3.5 percent on Tuesday to close at $15.51.

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