Codere, the Spanish gaming giant and parent company of Codere Online Luxembourg (NASDAQ: CDRO), announced its fifth restructuring agreement on Thursday, aiming to eliminate 92% of its debt.

Under the new agreement with creditors, Codere’s debt will be reduced from $1.72 billion to $138 million. Control of the company will shift to investors holding Codere’s super senior notes, though this will not significantly alter the company’s control structure, as many of these investors already hold a majority of Codere’s equity.

Following this restructuring, Codere’s debt-to-EBITDA (earnings before interest, taxes, depreciation, and amortization) ratio will drop to a manageable 0.9x.

Despite Debt Woes, Codere Stock Surges

The company, previously known as Grupo Codere and now operating as Nueva Codere, is undergoing significant changes in Spain. This includes selling assets in Argentina and spinning off its online business as part of its transformation.

Challenges in Argentina and Mexico—two key markets—have contributed to Codere’s debt issues. However, shares of its US-listed stock have surged nearly 140% since the beginning of the year.

Despite many US investors being unaware of the wagering opportunities in Latin America, the region’s online gaming market has achieved an eight-year compound annual growth rate of about 20% in Codere’s core markets.

Debt Stability Could Benefit Codere

The significant reduction in Codere’s debt could bring much-needed stability to the company, with equity investors hopeful that this restructuring will be successful.

With the debt burden lowered, the investment thesis might become clearer, attracting more attention. Analysts are optimistic, with their average price target suggesting a potential upside of 64.29% from Thursday’s close.

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