Research Update: Spanish Gaming Company Codere S.A. Downgraded To 'SD' From 'CC' On Interest Nonpayment

Spain-based Codere announced on April 22, 2021, that it had entered into a lock-up agreement with an ad hoc committee formed by a majority of its noteholders, to pursue a debt restructuring, which we see as a distressed exchange and tantamount to default. On March 30, 2021, Codere used its 30-day grace period to delay paying interest on its super senior notes due 2023. This payment has been further extended by an additional 30 days, which constitutes a default under our criteria, since it breaches a stated promise on a financial obligation, despite bondholders having consented to this extension, among other considerations in the indenture. We therefore lowered to 'D' from 'CCC-' our issue rating on the currently outstanding €250

...- Spain-based Codere announced on April 22, 2021, that it had entered into a lock-up agreement with an ad hoc committee formed by a majority of its noteholders, to pursue a debt restructuring, which we see as a distressed exchange and tantamount to default. - On March 30, 2021, Codere used its 30-day grace period to delay paying interest on its super senior notes due 2023. This payment has been further extended by an additional 30 days, which constitutes a default under our criteria, since it breaches a stated promise on a financial obligation, despite bondholders having consented to this extension, among other considerations in the indenture. - We therefore lowered to 'D' from '###-' our issue rating on the currently outstanding 250 million super senior notes due 2023, following the missed interest payment. - We affirmed our '##' rating on the 500 million and $300 million senior secured notes. The recovery rating on these notes remains at '4', but with lower recovery prospects than before,...

Research Update