Lakes Ent. may sell World Poker Tour

Nov 29, 2005 3:32 AM

Lakes Entertainment might sell its stake in the World Poker Tour in order to raise cash to continue to develop Native American casinos.

The Minnesota-based casino developer, which owns about 62 percent of World Poker Tour Enterprises (WPTE), reported last week that it needs additional capital "for operational and development needs" and that selling "a part or all" of its WPTE stock was being explored.

Lakes said it intends to hire an investment banking firm to explore selling the stock.

In SEC filings, Lakes indicated it needs about $10 million in additional capital by Dec. 31, 2005, and an additional $10 million by March 1, 2006.

One of Lakes’ pressing needs is financing of its efforts to develop a 380,000-square-foot casino for the Shingle Springs Band of Miwok Indians in El Dorado County, California.

Lakes has also announced plans to develop a company-owned casino resort in Vicksburg, Mississippi, and it has development and management agreements with five tribes for new casino projects in Michigan, California and Oklahoma.

Lakes owns roughly 12.5 million shares of WPTE stock.

Lakes CEO Lyle Berman co-founded the World Poker Tour with Steve Lipscomb. Both executives were unavailable for comment on Monday.

In addition to selling its stake in the World Poker Tour, Lakes is exploring other financing alternatives such as secured loans coupled with common stock purchase warrants, high-yield bonds or some other form of bridge financing.

Lakes has hired the investment banking firm of Roth Capital to assist in arranging its financing.