Hollywood Bowl strikes for £280m London IPO
Hollywood Bowl Group, the UK's largest 10-pin bowling operator, will float on the London Stock Exchange next month in a deal valuing it at around £280m.
The group, which runs 54 bowling centres around the country, has been striving to modernise the popular pastime with Americana-themed diners, licensed bars and interactive scoring systems that "customers didn't even know they wanted".
Steve Burns, chief executive of Hollywood Bowl, told Morning Wire that the changes have "created a lot more noise about bowling that just wasn't there two years ago".
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The group's private equity backer, Electra Partners, is expected to retain up to half of its 85 per cent stake, with the management partners keeping about half of their combined 15 per cent holding.
The group was initially formed over five years ago when Mitchells & Butlers sold its 24 Hollywood Bowl locations to rival operator AMF for £27m. Electra snapped up the group, which was then known as The Original Bowling Company, in 2014 for £91m.
Last year, Hollywood Bowl acquired a rival chain, Bowlplex. The deal stoked ire at the Competition and Markets Authority (CMA), prompting the group to offload five of the 16 venues. "We now know what we need to do to make the next set of acquisitions," Burns said.
He added that the group was "absolutely" open to future mergers and acquisitions activity "if the right opportunity presented itself". While international expansion isn't in the immediate pipeline, "we know an opportunity exists there".
Read more: M&B to sell Hollywood Bowl for £39m
The group made £86m in revenues for the year ending September, while like-for-like sales swelled 11 per cent during this period.
Its revenue jumped 25 per cent to £55m in the six months ending March. Nearly half of this came from bowling-related activities, while 28 per cent came from food and drink and 23 per cent from amusement machines.
Investec acted as sole sponsor, broker and bookrunner to the IPO. CMS is advising the group, while Mayer Brown is advising Investec.
