Eyes down for UK firms as Riva Gaming sheds £100m of debt

Riva Gaming Group, the private equity-owned bingo operator, has struck a deal with lenders to write off £100m of its debt, leading to instructions for a raft UK firms.

Linklaters, led by banking partner Rebecca Jarvis and private equity partner Richard Youle, acted for Riva Gaming on the restructuring, which saw the company agree a debt-for-equity swap with banks and sell off part of the business to ­former chief executive Simon Hannah.

The senior lenders, led by Royal Bank of Scotland (RBS) alongside Bank of Ireland and Allied Irish, called on CMS Cameron McKenna banking partner Martin Brown.

Travers Smith, led by corporate partner Helen Croke, won a place acting for Riva’s owner Hermes Private Equity. The firm took over from previous adviser Linklaters, which declared itself conflicted when Riva got into trouble last year.

Hannah, who bought seven Riva bingo venues for a nominal fee, used Eversheds, led by corporate partner John Sewell.

DLA Piper finance partner Tamsyn Mileham acted for mezzanine lender Babson Capital.

Linklaters advised Hermes on the acquisition of Mayfair Gaming and Beacon Bingo three years ago, and subsequently became company counsel when the two were bolted together to create Riva Gaming.

But Linklaters was forced to declare a conflict when Riva breached its covenants last year and began talks with lenders.

It is understood that the deal hands control of Riva to the banks, while Hermes has given up virtually its entire stake, worth an estimated £50m.

Camerons became RBS’s counsel when restructuring negotiations began in 2007, taking over from Osborne Clarke which advised on the original deal.

Brown said the latest deal was interesting because the senior lenders were now majority owned by taxpayers in the UK and Ireland.

“There was a new dynamic in dealing with the three banks, how they reacted to things,” he explained. “In particular the Irish banks needed to go to the regulator, which meant the deal was delayed.”