andover, Cinven and Permira are expected to relinquish up to half of their company stake. Gala Coral is reportedly facing a 2.8 billion euros mountain of debt.
According to the report, the betting company’s difficulties stem from a string of unanticipated tax and regulatory changes that have hit the casino and bingo industries, magnifying the impact of the recession. The company has closed six bingo halls this year already.
This is the latest private equity-owned company in a debt-for-equity swap with lenders. Last month, BC partners had to give up control of portfolio company Dometic, Swedish caravans-fittings maker. Lenders are likely to continue to take control of private equity-owned companies going forward as investment firms struggle to pay off the debt used to finance deals.