Codere Execs Depart as Company Acquires Over $100 Million in Potential Sale

Codere, a globally-recognized gambling operator based in Spain, has been working hard in recent years to achieve stability in the market. Nevertheless, rumors have recently emerged that the company’s €100 million ($108.67 million) investment could be a sign of an impending sale.

On Wednesday, the shareholders of Codere approved the financial injection, which will come from the issuing of new debt. At the same time, it was announced that the co-CEOs, Alberto González del Solar and Alejandro Rodino, will be stepping down from their roles effective immediately. The company is already searching for a replacement.

In addition, Codere is looking for ways to delay the maturities of certain bonds, worth around €700 million (US$760.7 million), for a year and is also undergoing a restructuring process to help reduce losses. The majority of the company’s ownership, which includes entities such as PGIM, Davidson Kempner and Jupiter, is currently focused on stabilizing the business, however, there is potential for something different in the future.

Sources have reported to Cinco Dias that, while shareholders are not in a rush to sell, they may be aiming to get the maximum return from a possible sale. This is evident in the company’s statement that the new CEO should have experience in mergers or “companies owned by venture capital funds, successfully sold to strategic buyers.”

In order for Codere to get back to its 2019 level, it will need to increase its gaming margin with the new money and restructuring. It is expecting to have an adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) of €196 million (US$213 million), which is an increase of 31% from the previous year. To achieve this, the company will be focusing on key markets, such as Spain, Argentina and Mexico, and looking to acquire independent gaming operators and potentially a new white label gaming option.

Avid Sher, the former Codere head of operations, recently replaced Moshe Edree as CEO of Codere Online. In light of this, the shareholders of Codere now have the power to start an exit process at any time, given that they own almost all of the company.