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CREDITORS FORCE CZECH LOTTERY INTO BANKRUPTCY

Posted 5/30/11 :

Clashes with lottery management scupper restructuring agreement
 
Creditors of the struggling Czech national lottery and betting firm Sazka (see previous InfoPowa reports) voted to send the company into bankruptcy Friday, reports the Reuters news service.
 
The vote followed arguments with the firm's management which effectively scuppered a prior agreement that involved a restructuring of the company, a spokeswoman for the Prague Municipal Court revealed.
 
Bankruptcy means the firm will be taken over by a receiver and its assets sold. It was unclear on Friday if and how it might continue to operate.
 
Registered claims against the company are about 10 billion crowns (around $579 million).
 
The Finance Ministry temporarily suspended Sazka's gaming licence earlier this month, a decision that has not yet taken effect and which Sazka has appealed.
 
Other than bondholders, the firm's largest creditors are closely held investment groups PPF and KKCG, with claims of 1.1 billion and 874 million crowns, respectively.  Other major creditors include Commerzbank, Landesbank Wueurttemburg-Baden, Citibank Europe, Ceska Sporiteina, Lottomatica, T-Mobile and Telefonica O2 Csech Republic.
 
Czech sports unions are the main shareholders, financing Sazka from profits in the past.
 
Taking advantage of the opportunity, the rival gambling firm Fortuna has announced plans to start its own lottery later this year



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