The gaming company Codere, Spain’s second largest operator, is considering listing to fund growth. Twice before, in 1999 and 2005, the company has proposed a listing but market conditions and the closure of bingo halls in Italy were said to have caused a rethink. Last week Codere entered an agreement with Corporación Interamericana de Entretenimiento (CIE) to acquire a 49% stake in CIE-Las Americas in Mexico. The CIE subsidiary holds some 65 gaming licences, including 45 Sportsbooks, existing Yaks (electronic bingo terminals), remote gambling and online lotteries.

Centro Banamex, the largest convention and exhibition centre in Latin America, the racecourse, sports betting facilities and a children’s theme park are all part of the agreement. The 49% of CIE Las Americas is being acquired, subject to approval, in exchange for Codere’s 50% interests in the existing joint venture with CIE Las Americas, US$175 million in cash and several deferred contingent payments. CIE is contributing certain gaming related activities currently held directly.

Codere operates over 45,000 gaming machines in Europe and Latin America. It has 5 casinos, 116 bingo halls, two racetracks and 51 off-track betting facilities with a presence in Spain, Italy, Argentina, Brazil, Colombia, Mexico, Panama and Uruguay. Last year the company formed a joint venture with the UK’s William Hill to take advantage of moves towards the licensing of sports betting in Spain. Operating profit in 2006 was up 154% from 2005 to €119.3 million (US$ million).

The IPO should fund the buyout of former shareholders the Franco brothers who agreed to sell their 41.5% interest in Codere last year. Credit Suisse is advising the company and the listing may come before August. Codere is said to be considering other financing such as private equity or a bond issue to pay existing debt and fund expansion. (E-06.12.07)

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