Officials at the Spanish gambling group Codere SA recently presented to private equity investors “Branded Horizon 2021,” a corporate recovery program including a digital makeover, new Mexican licenses and entry into the Brazilian gaming market. The three-year corporate transformation plan is in response to year-to-date losses of $62.5 million, primarily due to the collapse of the Argentine peso in 2017-2018. Codere officials said they would separate the Argentine unit’s performance from the firm’s corporate reporting going forward as it restructures its Argentine assets and operations.
The officials said the company would require an additional $227 million in working capital to finance its recovery plan. In addition, Codere may offer a public option regarding publishing new shares, which would require approval from its largest private-equity debt holders, Silver Point Capital and Prudential funds.
One potential glitch in Codere’s recovery plan may be the ongoing legal battle between Codere PE investors and the Sampedro Family, who founded the company and hold 19 percent of its shares. In January 2018, the Madrid High Court rejected the appeal of the Sampedros as they sought to have Codere’s new leadership team dismissed, claiming they had been illegitimately appointed by PE investors who took away the family’s voting rights. The Sampedros have taken their legal claim to a Connecticut district court.
