Bowlplex is a long-established operator of ten pin bowling centres across the UK. With 17 sites in total, it was the fourth largest operator by site number and was benefiting from a renaissance in the sector. After a number of years of challenging trading and two insolvency processes, the company’s bankers had undertaken a debt for equity swap in 2012 and installed an experienced management team, led by Chairman Sean Cooper, to deliver an ambitious turnaround plan.
With the last remaining issues from the final insolvency process approaching closure and the business on a far more even keel, the shareholders asked us to advise on the options for the business.
What difference did we make?
Following a review of the business and the wider market dynamics, we recommended that the shareholders should explore the option of a trade sale, given that it was clear the sector was undergoing a period of consolidation.
We marketed the opportunity to a narrow range of businesses, quickly reaching the conclusion that the most compelling proposition could be delivered by the largest operator, private equity-backed The Original Bowling Company (TOBC). There were, however, a number of key issues that we recognised could be a challenge, not least of which the likelihood of a referral to the CMA. Therefore, before agreeing a deal with TOBC, we needed to ensure that they would drive the competition review and that the risks of referral were substantially transferred to them.
Ultimately, following a lengthy CMA review, we completed the sale to TOBC at a multiple ahead of all sector benchmarks and without any warranty exposure for the vendors. The deal saw a significant return to the management team and allowed the bank to more than fully recover its debt provision.