Dominating the UK bingo news on Wednesday is the bombshell that Buzz Bingo – all 91 clubs have been sold. Caledonia Investments PLC announced that it has sold its majority shareholding in Nottingham-based bingo club chain Buzz Bingo to FTSE 100 asset manager Intermediate Capital Group PLC for a nominal fee.
ICG is already a long-term investor in Buzz and will be injecting £18 million into the business. The company has also managed to secure a new £10 million credit facility from Barclays bank, which will support further investment into the company, including the growth of the online site BuzzBingo.com, which has grown to be one the top bingo sites in the UK.
Buzz Bingo rebranded from Gala Leisure Ltd in May 2018 following the sale of Ladbrokes Coral Group Plc’s retail clubs.
With clubs set to reopen on May 17th after a third national lockdown, the bingo industry has been hard hit by restrictions and closures. Most bingo clubs were closed for around 10 months of the year in 2020, meaning many bingo clubs were unable to survive. Buzz, the UK's largest retail bingo operator closed 26 clubs in the Summer of last year. Other clubs across the country have also been unable to bear the cost of staying closed. BingoDaily estimates around 20% of Britain's bingo clubs closed for good in 2020. Already, a number of once-popular bingo clubs have closed permanently this year. It is more than likely that more will close as the year progresses.
Buzz Bingo CEO Speaks on Sale
Chris Matthews, Buzz Bingo Chief Executive, said:
“This agreement provides us with the financing we need to ensure our success when Covid-19 restrictions ease. Prior to Covid-19, we were in a strong position – and growing. But lockdowns meant we have only been able to fully trade for about six weeks since March 2020.”
“The new funding ensures we will continue to thrive. As the UK’s largest retail bingo operator and a cornerstone of many communities throughout the UK, we provide affordable entertainment to more than 1.1m retail customers. We can’t wait to welcome them back into all our 91 clubs throughout the UK on the 17th May.”
“We have invested heavily to ensure customers can stay safe and have fun, and the clubs performed well in the periods when they were allowed to open last year and we are also benefiting from the fast growth of our online offering Buzzbingo.com, which two years after launch is already one of the UK’s market leading operators in its own right.”
“We would like to thank Caledonia Investments Plc for their significant support over the past six years, and we look forward to continuing to work closely with ICG as our new shareholder”.
Buzz Bingo Year Long Struggles
It has been an unhappy twelve months for Buzz Bingo. Caledonia Investments PLC said Wednesday that its investment in Buzz was valued at nil as of February 28th, 2021, compared to £22.0 million as of September 30th, 2020.
Buzz refinanced in the summer of 2020 via a company voluntary arrangement, in which Caledonia injected £22 million. Job losses were announced at the Nottingham HQ in August.
The third national lockdown had led to the requirement for further funding, which Caledonia chose not to take part in. Thus, ICG stepped in to buy Buzz Bingo for a nominal fee.
ICG is a global alternative asset manager with more than 30 years' history, managing €47.2bn of assets in private debt, credit, and equity, primarily in closed-end funds.
A spokesperson for Buzz told BingoDaily that they are “Keen to reassure that business is continuing as normal with reopenings of our retail estate planned for 17th May”.