In the understatement of the year, I am no stock market expert, I just read the occasional stock picking newsletter. But this news doesn\’t look promising.
In an announcement on October 7th, Lakes Entertainment announced a stock dividend in all 12,480,000 shares in WPT Enterprises. That would be 61% of all outstanding common stock in WPTE.
\”The spin-off of WPTE shares to our shareholders provides an option for them to monetize the value of WPTE shares if they so choose,\” said Tim Cope, President and Chief Financial Officer of Lakes. \”In addition, Lakes will benefit in that we will no longer be required to consolidate WPTE\’s financial and business information in our SEC filings. This will enable us to provide greater transparency of Lakes\’ operations and financial results to our shareholders and the public.\”
Not long after WPTE was notified that it would be delisted from Nasdaq if it couldn\’t bring the stock price back up to $1 or more for ten consecutive days in the next six months, Lakes seems to be bailing on the WPTE. While experts said that this won\’t affect WPTE\’s already-sinking stock prices (closing at $.50 today), it does signify Lakes\’ intention of stepping back.
Though there may not be any hard feelings between the two companies, it is a tough-love sort of move on the part of the company that once loaned the WPT money to get it off the ground. Kinda like kicking your 30-year-old son out of the house to make it on his own, knowing there is potential there and not wanting to aide his lazy ass for another day. Okay, probably not the best analogy, but it\’s all I\’ve got.
