Bolsa Madrid-listed gambling company Codere SA is in negotiations to sell to South American casino provider Sun Dreams, 50% of its casino activities in Uruguay, according to news from Spain.
The change arises after a profit warning was given by the Spanish group regarding the Argentine peso’s devaluation, preceding the country’s primary elections in August.
The Spanish company is discussing a sale of up to half of its Uruguayan casinos in the midst of continuing uncertainty in Argentina, Codere’s largest market, which could raise more than US$ 163 m.
Sources cited by El Confidencial and other Spanish newspapers state that Codere has already obtained a first, non-binding bid from Sun Dreams, ready to reward approximately eight times the gross operating profit of the Uruguayan subsidiary of Codere.
Codere said that the business development possibilities in Uruguay were “evaluated” in response to the accounts, but noted that no contract had been formalised. The reports indicate that such an application is appealing and is probable to be recognised when rendered by the panel of Codere.
The Uruguayan business of Codere reported last year operating profits of US$ 22 m. In relation to 26 betting places and two racetracks, the Spanish group runs 2,252 gaming terminals in the nation, which was first introduced in 2002.
Sun Dreams, Chile’s biggest gaming organisation, has allegedly demanded a review of Uruguayan Codere’s records, with PwC ready to verify figures and assess legal hazards.
The deal could be closed in the coming weeks providing there are no setbacks.