South African horseracing and tote betting operator Phumelela Gaming and Leisure Limited has reportedly turned down a rescue deal that was to have seen giant British bookmaker Betfred purchase its entire business for approximately $55.6 million.
According to a short report from Gambling Insider, the Johannesburg-headquartered firm has instead opted to accept an earlier offer from one of its largest creditors, private equity investor Mary Oppenheimer Daughters, that will involve it receiving just over $28.8 million in exchange for its assets and large shareholding in local horseracing broadcaster Phumelela Gold International Limited.
Gambling Insider reported that the rescue deal may eventually end up costing Mary Oppenheimer Daughters as much as $55.3 million with the London-based investments firm having already supplied Phumelela Gaming and Leisure Limited with a loan valued at around $6 million. The source detailed that the plan moreover guarantees that the South African firm’s current creditors will receive a minimum of $33 million, which equates to a 72% assurance as opposed to the full promise earlier pledged by Betfred.
Phumelela Gaming and Leisure Limited is responsible for four horseracing facilities in South Africa including the prestigious Turffontein Racecourse but is reportedly struggling to cope with a debt of over $36 million as well as the recent coronavirus-related suspension of its domestic racing calendar. Betfred, which is led by billionaire British businessman Fred Done (pictured), had purportedly furthermore earlier offered to supply the besieged operator with a loan worth as much as $39 million that was to be utilized to satisfy its considerable shortfall.