Georgica deal ends Megabowl saga

LEISURE Group Georgica is taking full control of Megabowl in a deal that brings a two-year ownership saga over the struggling ten-pin bowling chain to a close.

The purchase is being financed with a £24m share placing at 75p a share and values Megabowl at about £77m.

Georgica is currently joint owner of the loss-making chain with venture firm Duke Street Capital. There are huge debts, and a complex ownership structure made it difficult to implement a turnaround strategy.

Full control over Megabowl would make the business capable of achieving annualised operating profits of about £16m before interest costs and write-offs in two years' time, Georgica said.

Most of the placing proceeds will pay off Megabowl's £23m mezzanine debts, leaving it with bank debts of about £52m.

Megabowl operates 50 bowling alleys and was created by the merger in 1999 of Duke Street and Allied Leisure's bowling activities.

In the year to 29 June, Megabowl made a £21m taxable loss on turnover of £82m.