Almost no country has been immune from the effects of the coronavirus, and Chile’s no exception. Its economy has taken a direct hit from the global pandemic, and its casinos are struggling to rebound, just like those elsewhere across the globe. While the next 12 months will bring a lot of changes in the gaming industry through acquisitions and fire sales, Chile’s two largest casino operators, Enjoy and Sun Dreams, have been caught up, as well. Each has made arrangements that will allow their casinos to continue to operate, at least until a more structured plan can be created.
Enjoy, based in Santiago, Chile, has announced through a securities filing that its creditors are ready to give $73.3 million through a debt restructuring plan. The money will be provided through international bondholders, who will cover roughly $11.97 million, and through local investors, ready to provide the remaining $61.4 million. The goal of the plan is to give it time to draft and approve a debt restructuring agreement, with $63.7 million to go to a bridge loan to ease the strain. Enjoy filed for bankruptcy protection this past April after COVID-19 forced its operations in Chile, Argentina and Uruguay to close a month earlier.
Sun International, which is based in South Africa, is behind Sun Dreams, the largest gaming operator in Chile. It owns 65% of the company, and has agreed to sell its stake to Nueva Inversiones Pacifico Sur for $160 million. That arrangement makes Pacifico Sur the sole owner, with the investment fund now controlling 100% of the company.
Sun International has been trying to find a buyer for its stake for several months and, prior to its agreement with Pacifico Sur, had almost locked in a similar deal with Marina del Sol, a Chilean casino operator that is owned through a joint venture between Canada-based private equity firm Clairvest Group and Chile-based real estate company Empresas Valmar. With properties in Argentina, Chile, Colombia, Panama and Peru, Sun International had a lot at stake before COVID-19 hit, and has a lot to lose as a result. Pacifico Sur has a rather large footprint, as well, serving as a major investor in everything from agriculture to real estate development.