The situation is not easy. Last April, the Spanish gaming giant postponed one of its debt maturities and needs to get the money to be able to pay it. If this capital is not obtained, the firm would be in a difficult situation due to the closure of its establishments generated by the coronavirus and the consequent fall in business.
Bank of America and Credit Suisse, advisers to the group to try to get the 100 million euros that it owes, have recommended the company to speak with different debt funds. That way, they could offer a quick solution to this difficult situation, albeit at a higher cost.
Among the candidates to finance Codere would be Pimco and Carlyle, as revealed by the Spanish newspaper El Confidencial, who recently met with the company leadership to learn about the real situation of the firm and their forecast to return to normal business, as well as the cash position. In this sense, Codere would have 130 million cash to be able to remain operational until next August.
However, the alarm lights went on earlier this month, when credit rating agencies Moody's and Standard & Poors lowered their credit rating to an "extremely speculative" level, considering a high risk of default in the next 12 months.
Thus, if they do not pay the coupon that expired on April 30, the company will default. This coupon is part of the bonds of 500 million euros and 300 million dollars, which the company has in circulation, and which are trading at 37% of their nominal value. In any case, if the capital is not obtained, it would be the current shareholders who would have to pay the coupon with their own resources, trusting in the viability of the company in order not to have to apply for bankruptcy.
Source: El Economista (España)
