Gala Coral begins bingo club sales

Bingo Company, Gala Coral is selling its 135 bingo clubs, hoping to generate bids of up to £300m.

The private equity-owned gambling group – which owns Gala Bingo – has recruited Lazards to conduct the sale. It is believed Chancellor George Osborne’s Budget boost to bingo will make the clubs a more attractive proposition to potential buyers.

Gala has approximately five million bingo members, of which it is estimated 1.2 million are active players. It accounts for 24% of all clubs. They are retaining the online Gala, although a partnership with their buyers may be floated regarding this aspect of the business.

Reportedly, the company has been informally seeking out buyers for several months. They have been asking for £250m.

It was floated to a host of potential suitors, including Henry Jackson’s OpCapita investment group, financier Hugh Osmond and Luke Johnson’s Risk Capital Partners. Mr Johnson was the Chairman of Channel 4 Television Corporation from January 2004 to January 2010, and owned Mayfair gaming from 2004-6, which was responsible for the chain of Riva bingo clubs. However, it appears that Mr Johnson, Mr Osmond, and Mr Jackson did not take the bait.

However, since the Budget, Gala Coral believe they can get a better price through an auction involving trade and private equity buyers.

Lazards’ sales pitch will talk up a business that captures a 38 per cent share of the market, generating 300,000 visits a week and 1.1m active customers over the past 12 months.

The clubs have generated £16m in earnings before interest, tax, depreciation in the first half of this year.