The funds move the Codere board forward and the Martínez Sampedros announce legal measures

The shareholders’ meeting of Codere, convened this Tuesday in an extraordinary session, has approved the restructuring announced by the company at the end of April and that it will cause its main creditors, the bondholders, to take 95% of a newly created parent company, thus achieving total control of the group.

The funds that currently control the gaming company, led by Silver Point, they have achieved a “large majority”, as Codere has announced to the CNMV, to carry out the proposed agreements. These, together with the rest of the shareholders, will now hold only 5% of the new parent company, if they remain with the company by then. One of them, the Alden Global fund, has already left: according to CNMV records, it owned 4.7% of Codere’s capital until May 10, the day on which its stake disappeared after selling it on the market. . The current shareholders will be able to stay in the new Codere, receiving warrants that will allow them to participate in a future sale of the group; or sell its participation at a price fixed upon the dissolution of the current parent, Codere SA

New funds

In addition to the overturning of control of Codere, the agreement also contemplates the issuance of some bridge bonds for 30 million euros for its most immediate expenses and another 70 to pay the coupons of the March and April debt, which have been deferred. To these 100 million will be added another 125 when the process ends, and the maturities of the issues of 500 million euros and 300 million dollars that are in progress will be extended until 2026 and 2027, and of which the bondholders will capitalize up to 367 million .

“With this process Codere considers, based on current estimates, that the viability of the company is ensured, thanks to the trust of its bondholders in the group’s prospects, in its management team and in the more than ten thousand employees that make up the organization, “the company says in a press release.

The funds were guaranteed the majority on the board. As reported by Codere when it announced the restructuring, 60% of the capital had guaranteed its approval. A percentage reached by adding the shares of the funds Silver Point (23.2%), M&G (21%), Abrams (8.7%) and Contrarian (7.2%).

Opposition

However, they have been opposed by the founders of Codere, the Martínez Sampedro brothers, owners of 14% of the group. Its former president, José Antonio Martínez Sampedro, has denounced in his presentation to shareholders the “rush” of the funds to approve the agreement that the company gives to the bondholders, “without presenting to the board a Codere valuation that serves as a reference to such a drastic and damaging proposal, “he explained. For this, the fact that the proposal lacked an independent valuation report, and that all documentation was provided in English,” involves hiding information from Spanish shareholders.

The Martínez Sampedros, as they warned in the previous one, confirm that they will take legal measures before the courts considering that the agreement approved today is “illegal” and does not comply with the one signed last summer, also sliding that “it is presented for the benefit of a few shareholders who they apparently have a common interest with the creditors who benefit from this new Lock up [el acuerdo] highly incompatible with the one agreed on July 13 and different from September 23, 2014 “.

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