Talks between Chilean hotel and casino operator Enjoy and private equity firm Advent International for the development of a joint venture have been put on hold, the gambling operator announced.
The two parties agreed on a future collaboration back in August. Following an Extraordinary General Shareholders Meeting, the Chile-based company said that a capital increase had been approved. Under the agreement between Enjoy and Advent International, the latter would pay $80 per share for more than 650,741 shares to raise the amount of $76.5 million, which represents around a third of the casino operator’s value.
As mentioned above, Enjoy has decided to stall negotiations on the deal for now. However, the capital increase plan is still in effect. Gerard Cood, General Manager of the casino company, said in a filing to Chile’s securities regulator that talks had been put on hold as they wanted to wait until more information became known in regard to the issuance of casino licenses for municipal casinos. Enjoy currently operates municipal gambling venues in Viña del Mar, Coquimbo, and Pucón.
The Superintendencia de Casinos de Juego, or the Chilean Gaming Control Board launched a consultation period during which matters related to the provision of operational casino licenses are to be discussed last September.
A hearing on the submission of applications for municipal casino licenses was to be held in October. However, numerous motions had previously been filed by operators to the country’s Supreme Court, so the regulator had decided to postpone the meeting.
Interested parties had filed for a remedy for the protection of their rights under the Chilean Constitution. Gambling operators had also pointed out the lack of substantial information regarding the tender process as a significant issue to be taken into consideration. In addition, the newly adopted requirements that a casino company would have to meet in order to be granted a license had been deemed excessive and ones that would harm the country’s gambling industry.
Under the new casino regulations, the seven municipal casino licenses are to be extended until the end of 2017. Said licenses’ validity expired last year. Arica, Coquimbo, Iquique, Pucon, Puerto Natales, Puerto Varas, and Viña del Mar are the seven municipalities where new casino concessions are to be awarded.
