Codere has merged its two Italian gaming machine businesses, FG Slot and Gap Games Italia, to create a new firm, Codwin.
The new division will be headed by executive director Andrea Rigodanzo, who’s the former director of FG Slot. Rigodanzo said the COVID-19 crisis played a significant role in driving the merger.
“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 stated.
“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 had an impact in forcing the combination. These regulations included the replacement of amusement-with-prize (AWP) machines with next-generation AWPR models and tax hikes from 13% in 2014 to 23.84% today.
The newly-formed division was approved by the shareholders of both FG Slot and Gap Games on April 16. Codere is the majority shareholder for both firms.
“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 ending March 31, 2020 amounted to €278.5m (£252.3m/$315.9m), of which €86.5m came from Italy, the highest from any country despite a 9.4% year-on-year drop.
Just last month, credit ratings agency Standards and Poors downgraded Codere’s rating for the 4th time in 8 months, warning of a risk of default in the next 6 months.