Codere has merged its two Italian gaming machine divisions, FG Slot and Gap Games Italia, to form a new division, Codwin.
The new division will be run by executive director Andrea Rigodanzo, who had been director of FG Slot. Rigodanzo said the novel coronavirus (Covid-19) pandemic played a major role in driving the combination.
“At a time of extreme difficulty for the legal gaming sector, and in particular for gaming machine operators, we decided to unite our forces to decisively tackle market challenges,” he explained.
“The Covid-19 pandemic comes at a time marked by the rampant increase in taxes and uneven regulations that have put pressure on a sector that every day tries to curb illegality by offering a legal and controlled product, and that employs tens of thousands of people.”
Codere said that in addition to the pandemic, new regulations played a role in forcing the merger. These regulations included the replacement of amusement-with-prize (AWP) machines with next-generation AWPR models and tax increases from 13% in 2014 to 23.84% today.
The merger was approved by the shareholders of both FG Slot and Gap Games on 16 April. Codere is the majority shareholder for both companies.
“With Codwin we want to offer a model of integration and management efficiency that can also help other companies continue operating in accordance with the usual standards of trust and legality,” Rigodanzo added. “We can support companies that are currently experiencing difficulties and implement a shared strategy that allows them to face the future with optimism and competition.”
Codere’s revenue for the 3 months to 31 March 2020 amounted to €278.5m (£252.3m/$315.9m), of which €86.5m came from Italy, the most from any country despite a 9.4% year-on-year decline.
Last month, credit ratings agency Standards and Poors downgraded Codere’s rating for the fourth time in eight months, warning of a risk of default in the next six months.