As reported by Pokerfuse this morning, Cereus will enter liquidation. The Cereus Network consists of Absolute Poker and Ultimate Bet, also known as UB. Blanca Games will liquidate the company with the goal of paying all players back. The liquidation idea has been presented to the Department of Justice but does not appear to be approved yet. The official KGC release can be read here.
This is just the beginning for Cereus players that are owed money. Liquidation is not a short or easy process It is even more complicated since the Department of Justice is involved. First, the DOJ must approve that this can happen. The next issue is selling off the assets. This includes everything from finding a buyer for the software, to selling the domains the company still owns, to selling the office furniture and everything in between.
It will also include an audit of all of the finances to account for all of the assets, to try and locate all of the cash the company has, and to find any misappropriation of company funds. There will also be negotiations with the DOJ to try and recover the seized funds. Those funds will be key in paying Cereus players at least some money back. Every country’s court system has their own procedure for a liquidation, but the process is going to be a long one regardless of what country this takes place in.
There are two online poker liquidations that immediately come to mind. Tusk Investments and Eurolinx/BetOnBet. Both of those companies had skins on the Microgaming Network. In the case of Tusk Investments, only 10-15% of the $5,300,000 was ever located. In the case of Eurolinx, it appears that nothing was ever located. In both cases, years later, players have yet to receive a dime. BetOnSports is an example of where players did receive something from liquidation. It took about four years, but players received just under 5 cents on the dollar.
Cereus/Blanca Games are in a different situation than those bankrupt Microgaming skins. They are more than just a skin on a large network. They actually own some unique software that was developed in house. That software has a value. Cereus would appear to own the full rights to the software. The poker software is likely their most valuable asset outside of any cash that is still in the bank. They also have a player list that has some value. Blanca Games also has other online gambling businesses. It is not known if the entire company would go into liquidation, or just the Cereus division.
Before players get too excited, it has been reported that Cereus was $48 million upside down, just to players. There are sure to be other creditors that will want their share too. Vendors, affiliates and possibly the Madeira Fjord shareholders are all going to join players on the list of creditors. There are a lot of people that are owed a lot of money by Cereus. I doubt the value of the software and the cash on hand will cover any significant amount of that debt.
Only time will tell if this turns out to be another online poker liquidation where players get nothing or if players can actually get at least a fraction of what they are owed. It is doubtful that we will know the answer to that for months, if not years.