Hollywood Bowl, the UK’s largest 10-pin bowling operator, is eyeing up expansion in Yorkshire following its float on the London Stock Exchange later this month.
The group, which currently has bowling centres in Leeds, Sheffield, Bradford and Hull, said it is keen to open more centres in the region.
It is in legal negotiations over a fifth site in Yorkshire which can’t be named yet because it is a greenfield site and the deal is yet to be signed.
The group, which creates around 60 jobs when it opens a new centre, said it has plans to expand further in the region over the medium term.
The listing will raise £181m and will value the firm at £240m. It had been cast into doubt following Britain’s decision to quit the European Union, but the group revived its plans in August and it will begin trading on September 21 at 160p per share.
The listing will see the firm’s private equity owner Electra Partners sell down its 85 per cent stake to 18 per cent. Electra, which acquired the firm in 2014 for £91m, will net £153m from the deal.
Hollywood Bowl‘s chief executive Steve Burns said: “I am delighted with the response we have received from investors toward Hollywood Bowl Group.
“We have achieved a huge amount over the past few years, transforming the business through investment and acquisition, and providing outstanding family entertainment to millions of customers every year.
“Keeping the customer experience at the heart of everything we do, we have exciting plans in place to grow the business further in the years ahead.”
Mr Burns and other members of the management team will also sell part of their stake in the company but will continue to hold 5.4 per cent of the group.
Last year, the group’s 54 centres delivered a 9 per cent increase in revenue to £86m while earnings rose 41 per cent to £20.6m.
Hollywood Bowl is the UK’s largest ten-pin bowling operator, operating across the UK under the Hollywood Bowl, AMF and Bowlplex brands.
The group specialises in operating large bowling centres, predominantly located in out of town multi-use leisure parks, which usually include a cinema and casual dining restaurants, and large retail parks.
The centres are designed to offer family entertainment with each site offering at least 16 bowling lanes, on-site dining, licensed bars, and family games arcades.
Bowling represents just under half (47 per cent) of the group’s total revenue, with food and beverages making up 28 per cent and and amusement machines contributing 23 per cent.
The group intends to undertake between seven to ten refurbishments a year in order to generate improved sales and at existing centres. Refurbished centres will benefit from new dining concepts such as Hollywood Diner and an upgraded bar as well as investment in the bowling experience including the introduction of VIP lanes, all of which will support higher prices and a higher spend per game.
In 2015, the group employed 1,386 employees mainly in its centres. By March 2016, following the acquisition of Bowlplex in December 2015, the group employed 1,948 employees.
Bill Priestley, chief investment partner at Electra, said: “This investment is a great example of Electra Partners’ investment strategy in action. When we first invested two years ago our plan was to accelerate the company’s growth and, together with Steve Burns and his team, this is exactly what we have done.
“Altogether these actions have more than doubled the size of the business while transforming it into the UK market leader with multiple levers for future growth.”
The UK leisure market was estimated to be worth £80.3bn in 2015, of which ten-pin bowling had a market share of 0.3 per cent, according to research from Pragma, the retail and consumer market strategy consultants.
In the period from 2013 to 2015, Pragma estimates that ten-pin bowling was the fastest growing segment of the leisure sector.
Bowling showed 6 per cent compound annual growth compared with an average of 3 per cent across the wider leisure sector.
Hollywood Bowl believes there are substantial opportunities to open new centres and plans to open two new centres a year.