Embattled Spanish gambling group Codere SA has agreed terms on a new ‘refinancing proposal’ with existing bondholders, which will allow the firm to access a further €250 million credit extension.
Following weeks of negotiations, Codere has secured the vital liquidity funding to keep its Spanish and South American business units afloat.
US bondholders Jupiter AM, Dryden Capital, Invesco and Blackrock have granted the credit extension, secured on interest terms of 12.75% – double the rate the company currently pays on its €800 million long-term debt annual interest.
The transaction has been approved by Codere’s majority debt-owners, US private equity funds Silver Point and Abrams Capital.
During lockdown, Codere revealed that it held a cash position of €83 million, but is reportedly burning €25 million per month maintaining its day-to-day operations.
On the edge of bankruptcy, Codere employed Bank of America to renegotiate debt-terms with US investors seeking to secure a further €100 million lifeline – a plea rejected by Silver Point and Abrams Capital.
Closing June trading, Spanish business news sources reported that Codere had been saved by Miami hedge fund Dryden Capital who had guaranteed the company access to a €120-150 million credit line under a 12-month arrangement.
Codere governance chose not to disclose the name of its new investor but stated that it had entered crucial negotiations in July with a guarantee of funding.
The week’s announcement will see Codere extend its short-term credit facility to €250 million, backed by US funds investing in beleaguered Spanish businesses emerging from lockdown.