Previous allegations of predatory tendencies were aimed towards private equity firm Callidus Capital Corporation, as it supposedly caused Bluberi Gaming Canada’ insolvency. Now Callidus has decided it would be best if it arranged to sell all Bluberi Gaming shares it owns and assign Bluberi’s debt to investment funds overseen by The Catalyst Capital Group Inc.
Last year Bluberi entered a CA$228-million lawsuit accusing Callidus Capital of predatory agenda against it. December 2018 was a heated month for the gaming company that claims it relied on support in time of need but instead ended up being tricked by the private equity firm.
Accusations back then indicated that Bluberi Gaming felt trapped in a major scheme devised by Callidus Capital that eventually led to the insolvency state. With the help of various actions, Callidus Capital caused Bluberi’s debt to increase to an unexpected amount.
Catalyst Owns 72.2% of Bluberi’s Shares
Back in 2018 Callidus was contemplating its next move even before the lawsuit filing. The plan for action back then was that it would purchase Bluberi’s assets after the bankruptcy. The recent announcement would see the Toronto-based company sell Bluberi Gaming’s shares and then assign the outstanding debt to The Catalyst Capital Group, owner of Callidus.
This purchase would cost is CA$92.7 million to The Catalyst Capital, as this is the amount of the debt accumulated up until this point. Following a detailed review of the pros and cons of this move, Callidus’ Board of Directors concluded that it will progress with the plan for action and see its completion. BDO Canada LLP had the task of evaluating the status quo when it comes to Bluberi Gaming. It concluded that its shares are priced between CA$84.5 million and CA$100.9 million.
In this sense, in order to offer a beneficial solution for everyone involved, the purchase is going to amount to CA$92.7 million. July 2 is projected to bring a mandatory meeting of Callidus shareholders that would aim to evaluate the situation and take into consideration their position on the subject. It could be recalled that March 2019 saw Callidus make a move towards selling the shares and assigning the debt.
July 2 Sees Shareholders’ Meeting
Callidus Capital helped the gaming company out with a loan reaching CA$18.5 million that had the ultimate objective of improving the company’s future operation and guaranteeing it will continue offering its products to as many happy customers as possible. Bluberi Gaming is known for its collaboration with casino venues across North and South America as a gaming software provider.
Striving to offer a diverse portfolio, it oversaw operation of gaming offerings both at brick-and-mortar casino venues and of mobile gaming. What ended up happening instead is that allegedly the private equity firm started changing previously negotiated mutually beneficial conditions. Eventually, the Toronto-based lending company was supposedly able to achieve its goal of leading Bluberi Gaming to insolvency.
Gerald Duhamel was the Chief Executive Officer of Bluberi Gaming up until 2015 and he was the individual accusing Callidus Capital of predatory tendencies jeopardizing the future of companies seeking support in times of need. The gaming company filed for bankruptcy, a case that includes the CA$228-million lawsuit seeking damages, but the Quebec Court of Appeal ruled to dismiss the lawsuit.