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Online Casino Owned by Creditors

Gala Coral has made headlines over the past more than a year because the gambling group is so far down the debt rabbit hole. Gala Coral seems like the company should be doing well because of its diversity of holdings, but a combination of new laws in the UK gambling market, coupled with the recession last year has meant that Gala is just falling incredibly behind. The company operates within the UK land and online casino gambling and bingo industries and the double taxation on land gambling groups caused a lot of fiscal instability. In the most recent months there was a lot of talk that the Gala Coral group would be forced to sell the company in hopes of recouping some of the debt and paying off creditors. The rumors circulated that there were some offers on the table but the most recent announcements indicate that Gala has now decided to strike a deal with the creditors themselves.

Gala has traded some of the control and stake in the land and online casino gambling group to the company’s creditors as a way to mitigate the situation and appease creditors. The US $3.7 billion in debt that Gala has racked up in the past several years is no chump change and it was time for the creditors to assess the situation and begin more aggressively recouping some of their investments. The new deal is a bit rare in the gambling industry as this is not common to other online casinos (since internet gambling is such a relatively new industry) but specific details released by the company indicate that Apollo Management is taking over primary control of the gambling group along with several other creditors, York Capital and Park Square Capital as well as Cerberus.

Each of the creditors taking over the Gala land and online casino gambling group are putting up $200 million toward the companies debt and then will work to assess new growth strategies for the respected company within the UK and perhaps even foreign gambling markets.