Parq Vancouver Casino Facing Monetary Issues
The fact that casinos are essentially cash cows doesn’t mean that they are immune to financial woes. In fact, it makes them experience monetary issues on a larger scale than other types of business ventures. Financial distress puts these casino operators under immense scrutiny which encumbers on their credibility.
At its core, its difficult to trust an organization responsible for paying out cash wins to players if players aren’t sure the supply is there. This means that gambling enthusiasts may withdraw from and view casino’s going through financial woes as unsafe or as a danger zone, which further impedes on the casino’s ability to refinance themselves and get out of their financial ditch.
All of these observations unfortunately are the reality of one of Canada’s biggest casinos, Parq Vancouver Casino. The casino which is owned by Parq Holdings L.P. has come under financial distress over the years and has just recently missed a huge interest debt payment on one of their second-lien loans.
Downgraded Due to Consistent Defaults
In previous months, the owners of the holding company have been silent and have refused to release any statements especially pertaining to the crucial interest payment that needed to be made on April 30th. It is now known that Parq Holdings, the holding company of Parq Vancouver was downgraded to discerning default rate of CCC from a B- by the Standard & Poor (S & P) Global Ratings after the group was given a 30-day grace allowance period to refinance their loans and make payments on time which they failed to do on April 30th.
The organization blames the underperformance of its operations and cites these reasons as their decision to defer payments. In turn this has had huge repercussions on the company’s bottom line, specifically its liquidity and also its ability to maintain debt.
The current financial future of Parq Vancouver as a subsidiary of the holding company is at risk. Due to the casino’s direct association with its holding company, the entity is bound to struggle to keep face and maintain casino standards as the mother ship crashes and burns. As of the moment, Parq Holdings L.P. is still trying to finance the loan of more than $400 million which dates back to 2014. As such they have struggled to refinance their loans and this has dampened their cash flow.
One solution the company owners seem to be considering is a bail out from an external investor or through corporate restructuring and possibly an acquisition or merger. Whether any of these solutions will be implemented before the company potential goes under is yet to be determined.
One of the main reasons for the S & P downgrade is due to the company’s inability to show meaningful steps to improve its lack of profitability against its extensively high debt yoke. The rating company hopes to force the company to seek out active ways to regain control of its financials and the hope is that the downgrade sparks a fuse. S&P has also sent the company a proposal on how to rise above their financial woes and claims that they will reconsider the downgrade should Parq Vancouver Holding implement some of their proposed strategies.
Counter Money Laundry Effects Are in Play
In recent years British Columbia – Canada’s far most western province has implemented a revolt crackdown of money laundering within the region. In the past casinos within this region were known to accept cash from players who would show up with briefcases stacked with cash bills without following any due diligence or money laundering protocols.
To crack down on these practices anti-money laundering laws and protocols where initiated and required casinos to determine the source of funds, especially large amounts of it. Since these laws were implemented in 2018 many casinos within the Vancouver area have reported lower profits and returns. If you want to know more and experience a great online casino, take a look at the following site.