Spanish gaming giant Codere has announced that its restructuring plan has been approved by shareholders.
US.- Codere has announced that its restructuring plan has been approved by shareholders. The proposed deal will hand Codere’s creditors full control of the company’s operating business.
The company said in a filing: “With this process Codere considers, based on current estimates, that it can ensure the viability of the company, thanks to the trust of its bondholders in the perspectives of the group, its management team and the more than ten thousand employees that make up the organisation.”
The restructuring plan involves the creation of a new business entity in which Codere bondholders will have a 95 per cent stake, while the remaining 5 per cent will be held by current Codere shareholders.
According to the filing, the company expects the new business will see €367m of debt capitalised into equity.
Codere shareholders will be granted warrants of up to 15 per cent of the new holding company, only if Codere’s market valuation for the next 10 years exceeds €220m.
Codere will have to raise a further €225m to ensure sustainability for its business after the impact of the closure of venues in many markets due to the pandemic. The amount will be raised by a bridge loan of €100m and €125m of super senior bonds, while debt payments with maturity in 2021 were agreed to be delayed to 2023 initially, and then to 2026.
However, the deal still requires a formal sign-off from at least 75 per cent of Codere creditors before the restructuring plan can be initiated.