Major LatAm operator

Codere Online merger approved by SPAC stockholders, set to close Nov. 30

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Stockholders of publicly traded special purpose acquisition company DD3 Acquisition Corp. have approved the proposed business combination with Codere Online, the firm reported last Friday.

The deal was approved at a special meeting held on November 18, in which stockholders of the company voted to approve the merger with the online gaming and sports betting operator for Latin America and Spain.

The business combination is expected to close “on or about” November 30, 2021, subject to the satisfaction of customary closing conditions. The ordinary shares and warrants of Codere Online are expected to begin trading on the Nasdaq Capital Market under the symbols “CDRO” and “CDROW,” respectively, following the deal consummation.

The company merger was initially reported as closing last week. Codere Online is set to become the first LatAm online gaming operator to go public, doing so through a merger with a publicly traded special purpose acquisition company in a $350 million deal.

The business launched in 2014 as part of casino operator Codere Group, and offers online sports betting and casino through its website and mobile application. It operates in its core markets of Spain, Italy, Mexico, Colombia and Panama, and has also recently started operating in the City of Buenos Aires, Argentina. It is complemented by Codere Group’s physical presence throughout LatAm, positioning it as a leading omnichannel player in the region.

The operator expects an approximately $145 million cash position to fund marketing expenditures, technology platform improvements and expansion into new high-growth Latin American markets, plus options to access the Hispanic online gambling niche in the US. The merger was first announced in June of 2021.

Codere Online will continue to be led by the company’s Managing Director Moshe Edree and its management team. Martin Werner, Founding Partner of DD3 Capital Partners, is expected to join the Codere Online Board of Directors.

In terms of investment opportunities following the merger, the company highlighted a “strong” market opportunity supported by favorable demographic trends in Latin America, as “very low existing market penetration” with increasing adoption of smartphones, e-commerce and internet connectivity position the region for “tremendous near, medium and long term growth.”

Other investment highlights mentioned by the company earlier this year include its omnichannel strategy. Codere Online’s indirect parent company, Codere Group, has a leading retail footprint encompassing approximately 10,800 venues throughout Latin America, Spain and Italy, as well as a registered retail database of over 3 million registered players.

“We are proud of this deal, which will provide our online team with the financial resources needed to grow Codere Online and take it to a new, higher level,” Vicente Di Loreto, CEO of Codere Group, said of the agreement earlier in 2021. “It is a good signal of the value we have been able to create in the last three years boosting this business unit.”

Earlier this month, the Spain-based business shared its Q3 financial results, with operating revenue for the first nine months of the year increasing more than 8% to $572.8 million. Moreover, revenue for the quarter increased by 63% to $266.67 million when compared to the same period in 2020.

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