Hollywood Bowl Group (LON:BOWL) – £7.5m purchase of Canadian-based bowling centres immediately earnings enhancing
This group, which is one of the world’s largest operators of bowling centres, has bought another three centres in Canada, taking its total there up to nine.
The deal for the three entertainment centres, which operate in the Calgary market, is immediately earnings enhancing.
The £7.5m cash purchase identifies the group's growth strategy in the fragmented Canadian market and shows the strong progress already being made by Splitsville, which was its first acquisition in Canada made last year.
Furthermore, the £413m capitalised group has identified a pipeline of acquisitions as well as new site opportunities in the Canadian market - with returns in line with Hollywood Bowl's financial investment criteria.
The Hollywood Bowl Group is one of the largest operators of bowling centres in the World and is the UK's largest ten-pin bowling operator, with a high-quality portfolio of 69 centres across the UK under the Hollywood Bowl and Puttstars mini-golf brands.
It specialises in operating large, high-quality bowling centres, predominantly located in out-of-town multi-use leisure parks (typically co-located with cinema and casual dining sites) and large retail parks.
The centres are designed to offer a complete family entertainment experience with each centre offering bowling lanes or mini-golf courses alongside on-site dining, licensed bars, and state-of-the-art family games arcades.
CEO Stephen Burns stated that:
"We are delighted to have made these acquisitions. They mark an important step towards our planned expansion of the Splitsville brand in Canada, where there is significant demand for affordable, family-friendly leisure experiences.
These are our first centres in the important Alberta market, we are looking forward to applying our knowledge and experience to these centres.
We are focused on enhancing the customer experience as we invest in and grow their businesses over the coming years."
After having hit 273p earlier in February, the shares of this highly cash generative group are now just 241p, at which level they are a more than entertaining investment for those seeking growth.
(Profile 14.11.19 @ 240p set a Target Price of 300p*)