Press Release
Date : 12th April 2010
Praesepediversifies portfolio with £45m Beacon purchase
Milton Keynes, UK – Praesepe plc, the AIM-listed company led byNick Harding, the former President of UK trade association BACTA, has consolidated its position asBritain’s fastest growing low stake high volume gaming organisation with the acquisition ofBeacon Entertainments.The conditional agreement to purchase carries a purchase price of £5m [€5.7m/$7.7m] (excluding transaction costs) and the assumption of £40m [€45.9m/$61.5m] of existing bank debt. The deal will add 26 Adult Gaming Centres currently operating under the ‘Showboat’ brand and six bingo clubs under the ‘Beacon Bingo’ brand to Praesepe’s portfolio which on completion will rise to 86 venues located in England, Scotland and Wales.
Beacon Entertainments generated turnover of £35.9m [€41.2m/$55.2m] and operating profit before depreciation, amortisation and non-recurring costs of £5.4m [€6.2m/$8.3m] in the 56 weeks ended 26 April 2009.The acquisition is expected to start generating significant synergies within the six months following completion and will be fully realised in the year ending 31 December 2011.Synergies once fully realised, will amount to approximately £2m [€2.3m/$3.1m] per year.
The purchase is conditional upon shareholder approval, which will be sought at the General Meeting of the Company due to take place on 19 April.Qualifying as a reverse acquisition under AIM Rules, re-admission of the Enlarged Group (including admission of the consideration shares) is expected on 20 April.
Following completion, Brian Mattingley, currently Executive Chairman of Beacon, will join the Praesepe Board as an Executive Director with a focus on business development.He has extensive experience of the UK gaming sector having held senior positions at Gala Coral Group and served as Chief Executive of Ritz Bingo Ltd.Mr Mattingley has been a non-executive director of 888 Holdings plc since March 2006.
Reflecting on the purchase, Nick Harding, CEO at Praesepe said: “I’m absolutely delighted at this latest acquisition, which provides us with an excellent platform for growth and consolidation.We are acquiring a well run business with strong market presence in both AGCs and bingo clubs including the Beacon Club in Cricklewood, widely regarded as one of the most prestigious in the UK. The successful integration of our acquisitions to date – including the flagship Crystal Rooms in London’s Leicester Square – give us the confidence that we will maximise the potential of these sites. When we completed our first acquisition in July 2008we set out our strategyof creating a diversifiedlow stake high volume gaming group largely through acquisitions.Four acquisitions on andI am pleased the market can see that we are continuing to fulfilthe pledges we made.
“From a personal perspectiveit’s great to be renewing my association with the mainstreambingo sector and of course a business which was created by Jimmy Thomas. My first job was running a Showboat arcade and I managed the first Beacon bingo club which was in Hounslow.UK bingo has a market value of £1.7billion [€2.0bn/$2.6bn] andthe management team, which will be bolsteredby the addition of Brian Mattingley,hassome very exciting ideas and initiatives to build on and enhance its reputation as a superb entertainment proposition.”
He added: “This is the first gaming business to have been released by a clearing bank post the smoking ban.I think the deal represents a ‘win, win, win’ situation in thatthe bankhas a proper repayment schedule, our gaming portfoliois much stronger and the Beacon Entertainments staff now have the career opportunities and security which come with being part of a plc.I amtremendously enthusiastic about integrating the business and developing theopportunities of joining our existing Micro Bingo clubs with Beacon,developing the Beacon Bingo online offer and in so doing moving evercloser to our ultimate goal of creating a leading Europeanlow stake high volumegaming group.”
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Praesepe CEO, Nick Harding