Chile: A Santiago court greenlights Enjoy's new judicial reorganization process

The 8th Civil Court of Santiago announced that it has initiated the judicial reorganization procedure filed at the end of January by Enjoy, a major operator in the gaming sector in Latin America, and granted the company the financial protection provided by law until April 24.

In a communication from the company to the Financial Market Commission (CMF), the operator indicated that the reorganization process will be in charge of the lawyer and overseer Juan Ignacio Jamarne, who will be responsible for conducting the instance with the creditors.

It should be noted that on January 29, Enjoy informed the CMF that its board of directors agreed to initiate a new financial restructuring process, two years after having concluded a judicial reorganization procedure for its financial liabilities.

Enjoy explained that, within the framework of this new process, "all those credits originated prior to the reorganization resolution will be subject to this procedure, i.e. those credits originated prior to February 12, 2024".

"Thus, as long as the judicial reorganization agreement that will be proposed in the proceeding is not approved, Enjoy is legally unable to service, for the time being, those credits subject to the judicial reorganization proceeding, both in principal and interest accrued to date", the organization specified.

The firm also detailed that these include, among others, the S Series Bonds registered in the Securities Registry under No. 1,060 dated January 14, 2021, and maturing on August 14, 2030, the T Series Convertible Bonds registered in the Securities Registry under No. 1,609 dated February 22, 2021, and maturing on August 14, 2119, and the Bonds placed in the international market maturing on August 14, 2027. 

In another statement, Enjoy announced that in this way it will begin the first steps to "restructure its liabilities and assets, continue with the development of the business and fulfill its commitments to creditors, workers and the communities where it is present, to finally recover its operational normality".

The company's CEO, Esteban Rigo-Righi, said: "We hope that this process will lead us to an agreement that will enable us to emerge stronger and be able to resume our investment plans, improve operational profitability and strengthen our financial position. All our priorities are focused on our employees, customers, suppliers, and creditors."

Lastly, the company stated that this process involves the Enjoy parent company and not its subsidiaries, hotels, and casinos, which are expected to continue to comply with all their obligations as before.

Shares fall

At the time, the market reacted negatively to Enjoy's announcement of a new financial restructuring. According to Diario Financiero, at the close of trading on Tuesday, January 30 on the Santiago Stock Exchange, Enjoy's shares fell 40.11% to CLP 0.524 Chilean pesos (CLP), equivalent to $ 0.0006.

Additionally, it was highlighted that the company's shares reduced their opening decline, after plummeting 60% to CLP 0.35 per share in the first 10 minutes of trading on the stock exchange.