Bondholders of Codere SA, including Jupiter Fund Management Plc, Invesco Asset Management, PGIM Ltd. and Davidson Kempner Capital Management, are set to take over the gaming firm as part of a deal to restructure its debt for the second time since the beginning of the pandemic.
The company, which is based in Madrid, has reached an agreement with a group of creditors to convert almost half of its existing senior debt, about 350 million euros ($422 million) into equity. The remainder will be partially amended or converted into subordinated notes that pay interest with more debt. In other words, the new financing includes a new 100 million-euro loan, and 125 million euros of super senior notes, reports BloombergQuint.
Most of the company’s sites in Spain, Italy and America have either closed or operated with restrictions since March last year due to Covid-19. Therefore losses rose to 237 million euros in 2020, up from 67 million euros a year earlier. The firm had already extended the maturity of its debt and raised new super-senior debt in the summer to counter the negative impact of site closures.
More than 75% of bondholders need to support the deal. If completed, Codere will transfer operations to a new holding company, of which bondholders will control 95%.
Codere’s 500 million euros of senior secured notes were up 2 cents on the euro to almost 58 cents on Friday, the biggest jump in two months, according to CBBT data.