Lyle Berman, a legendary Minnesota businessman and a member of the American Gaming Association's Gaming Hall of Fame, is getting into the emerging esports gaming industry and is reuniting with one of his previous gaming businesses in his latest venture.
Berman, 77, a co-founder of Grand Casinos Inc., is using a special-purpose acquisition company based in Minnesota, Black Ridge Acquisition Corp., to buy two companies and form Allied Esports Entertainment.
"Esports is going to explode," Berman said. "By everybody's prediction there are more people who will be watching it [esports] in a few years than watch the NFL, NBA and baseball combined."
Black Ridge announced last week it would acquire Allied Esports International and WPT Enterprises from China-based Ourgame International Holdings. The Minneapolis company will issue about 11.6 million shares, valued at $118 million, to Ourgame, plus additional warrants and $50 million in milestone payments. The debt and equity deal is valued at $213.8 million by Thomson Reuters.
The new company will have a presence in Minneapolis but will move its headquarters to Irvine, Calif. It will have 100 employees.
"There are hundreds of millions of people who play esports on a regular basis throughout the world," Berman added. "We think that its an emerging industry that has really got incredible growth potential and we are kind of in on the ground floor."
The combined revenue for WPT and Allied Esports International will be about $35.1 million in 2019 and is expected to grow to $108 million by 2020 and $208 million by 2021, a company spokesman said.
In a conference call announcing the deal last week, the company estimated the esports industry will be an $11 billion opportunity in a few years.
