Gala Corel seem to be fighting for its life although many hope a restructuring plan will breathe some life in to the company. Lenders have written off a staggering £558 million as part of a takeover by the company’s creditors. The deal is part of an equity swap which saw the exit of private owners Candover, Cinven and Perimra after seven years.
The new owners are Apollo, Cerberus, Park Square and York Capital who have injected £200 million to support the business of 145 bingo clubs and 1,600 betting shops. Many blame the UK smoking ban for the demise of online bingo but it seems clear that many bingo players are simply switching to the online game. Whilst there is no doubt that live bingo is in decline, online bingo is still seeing rapid growth. The economic slowdown has also hit online bingo and betting shops hard during the last couple of year.
Analysts predict a brighter future the Gala although it is clear the company simply has to increase its footfall. Even after an upturn in the UK economy with Gala’s debt shrinking by £700m the sad fact is that the current debt is a staggering £1.9 billion.
Perhaps for stability the management team will remain the same with Neil Goulden remaining executive chairman.
Neil Goulden stated: ‘The restructured group is now in a strong position and fully able to complete in an increasingly competitive and global gaming market”.
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