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The Light At The End Of The Tunnel: Chilean Casinos Find A Way To Debt Repackaging

Article by : Helen Sep 3, 2020

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Updated: Aug 9, 2022

The coronavirus epidemic has seen a record decline in revenue for the two biggest gambling operators. Enjoy, as well as Sun Dreams are currently breaking their backs to ensure lenders and investors that they need some time and funds to cope with the global pandemic. Almost all casinos have witnessed a disastrous economic situation, regardless of their location. Covid-19 has proven that casinos are also one of the weaknesses in the global economy. Gaming operators located in Chile are also no exception to this rule.

The global pandemic has caused severe stagnation in the local economy. Chilean Casinos are trying to find ways to restore their pre-crisis indicators and get out of a challenging situation. It looks like the coming months will show a whole series of changes in the local casino market. This is not just about acquisitions or new partnerships between casino operators. Enjoy and Sun Dreams have already announced that they are developing clear plans to restructure their debts to creditors and change their business models.

Enjoy, headquartered in Santiago, performed highly successful negotiations with lenders. According to preliminary arrangements, the gambling operator will receive more than $73 million as part of a new debt restructuring plan. Part of the funds, namely $11.97 million, will go to the company’s accounts from international bonds holders. The rest ($61.4 million) will be transferred to Enjoy from local investors.

The goal of such a generous loan is to keep the company afloat until management has a clear plan of action. This plan should convince investors and lenders that Enjoy can really get out of the difficult situation and continue its successful business.

The firm already filed for bankruptcy protection in April 2020. This move was forced after the casinos slammed their doors due to Covid-19. Enjoy has attempted to reorganize its debt through local courts. The gaming brand referred to the fact that even before the casino’s closure due to the coronavirus, the gaming hall had already been idle for a month due to legal proceedings.

Sun International has decided to sell its stake in Nueva Inversiones Pacifico Sur. The initial amount of the deal is $160 million. Pacifico Sur will become the full owner of all 100% of its shares if the agreement comes into force. This will allow the gaming brand to make vital decisions much faster and develop a clear business development strategy taking the current situation into account.

Sun International has been attempting to get a buyer to sell its entire stake in Pacifico Sur for a couple of months. Marina del Sol was the first buyer to acquire a stake in Chile’s most extensive gaming brand. After the situation with Covid-19 became more and more difficult, Sun International began to suffer losses. The brand made the final decision in favor of the Pacifico Sur proposal. Thus, Pacifico Sur will become one of the largest operators offering entertainment services to customers in Chile. Moreover, the company has demonstrated that it has sufficient financial support to continue its development in the region.

The brand is ready to use all its financial strength to ensure its long-term growth.

The platform is currently controlled and operated by the brothers Claudio and Humberto Fisher Llop. The company also invests in various businesses based in Chile. This includes agricultural businesses, entertainment services, and real estate. This way, the firm managed to diversify its income while facing Covid-19 aftereffects.

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