Epiris sells remaining 17.8% stake in Hollywood Bowl

Kenny Wastell
10 April 2017

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Epiris has sold its remaining 17.8% stake in listed UK tenpin bowling operator Hollywood Bowl for ТЃ40m.

The exit represents a 3.9x return for Epris after a three-year holding period, equivalent to an IRR of 92%.

Hollywood Bowl floated on the London Stock Exchange in September 2016 with a market cap of £240m. The GP received gross proceeds of £153m from the offering, which saw the company's shares priced at 160 pence apiece.

Under Epiris's tenure, Hollywood Bowl expanded by investing in new sites and, most recently, bolting on competitor Bowlplex in 2015.

The exit is the latest in a series of divestments by Epiris, as it approaches the end of its 12-month notice period as investment portfolio manager of listed LP Electra Private Equity. It comes shortly after the GP divested nursery school business Treetops Nurseries to trade buyer Busy Bees and the sale of its remaining stake in Allflex Corporation to an undisclosed existing shareholder for £70.3m.

Previous funding
In 2010, CBPE Capital backed AMF Bowling's acquisition of Hollywood Bowl, taking a minority stake in the company through a £20m investment.

Epiris (at the time known as Electra Partners) acquired the business from CBPE in a deal valued at £91m in 2014, investing £51m of equity in the transaction, alongside the company's management. GE, Barclays and Lloyds provided debt facilities to support the transaction.

Listed entity Electra Private Equity deployed a further £10m to finance the Bowlplex purchase in 2015. Around the same time, Epiris invested a further £11m to pre-emptively acquire a portion of the company's senior debt at a discount to par from one of its lenders.

Company
Founded in 2010 and headquartered in Hemel Hempstead, Hollywood Bowl comprises 54 bowling centres across the UK and has a total headcount of 1,950.

In the financial year ending in September 2016, the business generated a turnover of £106.6m with adjusted EBITDA of £29.4m, according to publicly available documents, representing a year-on-year increase of 23.9% and 42.6% respectively.

People
Epiris – Bill Priestley (chief investment partner); Ian Wood (investment director).
Hollywood Bowl – Stephen Burns (CEO).