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In the United Kingdom and Caledonia Investments has reportedly sold its majority stake in land-based bingo operator Buzz Bingo to London-listed asset management firm Intermediate Capital Group for a nominal amount.
According to a Wednesday report from the online financial news domain at MorningStar.com, the former backer detailed that it took the decision after the value of its investment in Buzz Bingo dropped from around £22 million ($30.6 million) in September to currently stand ‘at nil’. The source also explained that this depreciation came following a year in which most of the operator’s 92-strong estate of bingo clubs have been shuttered as a direct result of the coronavirus pandemic and associated government health and social distancing restrictions.
Previously owned and operated by British retail bookmaking giant Gala Coral Group under the Gala Bingo moniker, Nottingham-headquartered Buzz Bingo was sold to Caledonia Investments for £241 million ($335.7 million) in 2015 following its parent’s own purchase by rival sportsbetting behemoth Ladbrokes. The bingo operator subsequently maintained its previous identity until a little over 30 months ago when it began implementing a £40 million ($55.7 million) rebrand that had moreover involved the offloading of eleven clubs in places such as Gateshead and Bridlington.
Buzz Bingo reportedly refinanced via a voluntary company arrangement last summer that had involved Caledonia Investment stumping up approximately £22 million ($30.6 million) of its own cash. However, the London-listed investments trust purportedly refused to part with any additional support when the bingo operator subsequently began seeking even more funding to help assuage losses accrued as a result of the ongoing coronavirus-related closure of its entire estate, which may now continue until well into May.
Caledonia Investments used an official Wednesday filing to declare that it had decided to offload its stake in Buzz Bingo after ‘having carefully assessed the available investment opportunity’ and consequently opting ‘not to participate in the latest fundraising’. It furthermore stated that Intermediate Capital Group in partnership with Barclays ‘have provided further capital’ to Buzz Bingo and that ‘a full portfolio trading update’ is due to be released early next month ‘incorporating the year-end valuations’.
Read the filing from Caledonia Investments…
“The coronavirus crisis and the severe restrictions imposed by the government on leisure sector businesses have led to Buzz Bingo’s clubs being unable to trade for much of the past twelve months.”
News of the sale reportedly sent the value of shares in Caledonia Investments up by 7% overnight to £26.90 ($37.45) while interests in Intermediate Capital Group, which held some £898 million ($1.25 billion) in available liquidity at the end of December, conversely experienced a 1.4% slump to be worth just over £19.02 ($26.48).
Source: Worldcasinodirectory, Worldcasinonews