Trive Capital Partners offers to acquire Ten Entertainment Group for £287 million

LONDON, UK: Neon Buyer Limited, backed by Trive Capital Partners LP reached agreement to acquire Ten Entertainment Group plc (TEG) at the rate of 412.5 pence in cash. The acquisition values TEG’s entire issued, and to be issued, ordinary share capital at approximately £287 million on a fully diluted basis.

Ten Entertainment Group

It and implies a multiple of approximately 7.3 times TEG’s Group Adjusted EBITDA after rental costs for the twelve months ended 2 July 2023.

The acquisition price represents a premium of approximately 46.3 per cent and 49.7 per cent to the volume-weighted average price of 281.9 pence per TEG Share and 275.6 pence per TEG Share for the six-month and twelve-month period ended 5 December 2023 respectively.

The Ten Entertainment Group plc (TEG) directors believe that TEG’s value-for-money leisure proposition, high quality customer experience, proven expansion strategy, and strong capital base provide a foundation for continued sustainable growth. Since the start of this year, overall operational performance has been in line with the TEG Directors’ expectations.

Notwithstanding the opportunities to accelerate this growth, the TEG Directors are conscious of the need to be balanced against the uncertainties and risks that exist in the short and medium term.

TEG is not immune to the highly unstable national and international political outlook together with a volatile economic backdrop, all of which have impacted UK economic conditions and UK consumer confidence as well as having led to significant inflation in certain input costs.

Trive Capital Partners views TEG as a high-quality and leading company in the leisure and hospitality sector with an experienced management team that has a clear vision and growth strategy for the future direction of TEG.

Trive Capital Partners believes TEG has established itself as a highly regarded operator, offering a high-quality customer experience. Trive holds the TEG management team in high regard and values their operational expertise and experience.

Neon Buyer Limited believes TEG is better positioned to achieve its growth potential and to create long-term value for the benefit of customers, employees and other stakeholders as a private company than as a public company.

Adam Bellamy, the Chair of TEG, said: “TEG is one of the UK’s largest listed leisure businesses, with a highly capable management team and a strong track record of growing sales and profit. In particular, since reopening after the Covid pandemic, TEG has achieved record results with Group Adjusted PBT of £26.1m delivered in FY22.

I am confident that the growth strategy we have in place for the business will continue to deliver for all our stakeholders. However, whilst TEG has performed well in the public markets in comparison with its peers, the Acquisition provides all TEG Shareholders with the opportunity and certainty of an exit which I believe recognises the underlying value in our business.

The price offered by Bidco represents an attractive premium to TEG’s prevailing share price and accordingly the TEG Directors have no hesitation in recommending the offer to our shareholders.”

Shravan Thadani, Partner of Trive, said: “Trive is delighted to have reached agreement with the TEG Board with respect to the Acquisition. We have been extremely impressed by the TEG management team and TEG’s ability to deliver a high quality customer experience across its locations in the UK.

Trive believes that private ownership will enable TEG to achieve its long-term growth potential through continued investment in organic initiatives and strategic acquisitions. To that end, and given our experience in the consumer and multi-unit retail sectors, we are excited to provide the operational resources, strategic support and capital required to enhance TEG’s next phase of growth.”

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