Grupo Codere is on its last legs. After shareholders recently took control of the company, it was expected that assets would be dissolved. With that plan underway, trading of the company’s shares on Spain’s Madrid Exchange are to be suspended.
Only a few weeks ago, Codere shareholders and former owners reached a deal on how the company was to be structured. Shareholders took hold of 95% of the company, with the remainder left to the former hierarchy.
Now, following a shareholder meeting that determined how to dissolve the company, the National Securities Exchange Commission (CNMV, for its Spanish acronym) has been asked to halt the trading of Group Codere SA. The exchange agreed and the listing will be suspended on December 17.
Shareholders had approved the proposed resolution to dissolve the company and the opening of winding-up proceedings. Furthermore, it was agreed to request the CNMV the suspension and removal from trading of their securities,” said the CNMV.
Removing Grupo Codere, according to the exchange, will be definitive and non-reversible until shareholders show cause and provide a new roadmap to change course.
Codere Undergoing Major Transformation
As part of last month’s deal, shareholders agreed to invest €225 million (about US$253 million) in exchange for almost complete control of the company. The debt-for-equity offering was a prelude to the sale of company assets.
Part of the restructuring included the separation of Codere’s online operations. This facilitated Codere Online’s launch as a publicly traded company. The launch was then made possible through a deal with special purpose acquisition company DD3 Acquisition Corp. II. Trading as CDRO, Codere Online made its NASDAQ debut on December 1.
Codere Online will continue to operate, providing online gambling options to the Spanish and Latin American markets. Codere’s land-based operations may have had difficulties, but its online presence has been more resilient. The company, through subsidiaries such as Codere Online Luxembourg and Servicios de Juego Online, has provided online gaming in its home country, as well as in Argentina, Colombia, Italy, Mexico, Panama and Uruguay.
Codere Online launched in the City of Buenos Aires, Argentina on December 9.
Future of Land-Based Operations In a State of Flux
Codere has contracts to provide around 57,130 gaming machines in all of those countries. In Argentina’s Buenos Aires province, it operates 13 gaming halls and 14 bingo halls. In Mexico, through different partnerships, it operates another 95 gaming halls, 93 sports betting shops, and a racetrack.
The future of those land-based operations will now have to be determined as the dissolution agreement is sorted out.
Grupo Codere is to be liquidated, with only the operating segment of the old company transferred to the new Codere New Topco company.
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