Spanish gaming group Codere SA on Thursday said it is seeking protection from creditors and starting talks to avoid insolvency. Codere has been struggling to keep up with debt payments in recent months because of higher tax bills and other costs, a Reuters report said. 

Reuters, citing Codere's filings, said the company had €1.27 billion ($1.73 billion) of debt at the end of last September. This include three bond issues and other loans. Codere has up to four months to reach a deal with banks and investors.

Loss-making Codere made several late payments on bond coupons in recent months as it tried to win time to restructure its debts. It warned on Thursday that it may be unable to repay a €127 million loan due on January 5 if it does not first reach an agreement with lenders, the report said.

Private equity firm Blackstone Group LP, through its credit arm GSO Capital Partners, and hedge fund Canyon Capital LLC are among investors that have bought up Codere debt in recent months, Reuters said.

Sources close to Codere's debt talks have said bondholder debts could be cut by half in a debt-for-equity swap, the report stated.