Supplier News
Uruguay – Enjoy to purchase the Conrad
By Phil - 16 January 2017
Chilean casino operator Enjoy is paving the way for the purchase of the remaining 55 per cent of the Conrad Punta del Este Resort.
Enjoy has informed Chile’s securities and insurance regulator (SVS) that it has reached an agreement with its bondholders to raise the limit of its debt in order to obtain the necessary funds for its total purchase. Consequently Enjoy will be able to raise between US$350m and US$500m in order to obtain the remaining 55 per cent of the landmark hotel and casino which is worth an estimated US$200m.
In March 2013 the Uruguayan government approved a deal where the current operator of the Conrad hotel and casino in Uruguay would switch from Baluma SA to Enjoy SA meaning that Enjoy took control over the Conrad. The deal was first announced in November 2012. According to the terms of the Conrad deal Enjoy acquired 45 per cent of Baluma S.A ., the Caesars subsidiary which owned and operated the Conrad Punta Del Este Resort and Casino in Punta Del Este, Uruguay for US$139.5m in cash and stock and Caesars became a shareholder in Enjoy. Under the agreement Caesars and Enjoy both cooperate on marketing and player development. It was also announced that in three to five years time Enjoy would be given the option to acquire the remaining stake in Baluma S.A.
In May 2015 it was announced that Enjoy had instructed the Bank of America’s corporate and investment banking division Merrill Lynch with the task of finding a partner to participate in its plan to keep 100 per cent of the casino acquiring the 55 per cent it currently has in Caesars Entertainment. In September after an Extraordinary General Meeting of Shareholders, Enjoy approved a capital increase which would allow its new partner, Advent International, to enter the business and develop a joint venture. However in November it was announced that Enjoy had temporarily suspended its agreement with the American global private equity firm. According to local press the company’s agreement with Advent is still on hold while the company has decided to take this alternative route to purchase the remaining share of the casino and hotel.
Enjoy is the leader of the Chilean casino industry with around 37 per cent of the market and recorded sales of US$325m in 2012. The company operates over 6,000 slot machines, 274 tables and 860 bingo seats in Chile. In Chile the company operates seven casinos. It also operates two other casinos in Argentina and Uruguay. As well as gaining eventual ownership of the Conrad Enjoy is also looking to expand further in the region. In 2015 Enjoy signed a Memorandum of Understanding with the Decameron hotel chain which owns and operates a chain of hotels in the Caribbean, Central America, South America, and Africa. In February 2016 Enjoy inaugurated its first Colombian casino on the island of San Andrés in the Caribbean Sea. It is the first of three casinos that the company will open with the hotel chain.
