FTSE250 Caledonia Investments has disclosed that it has sold its majority stake in Buzz Bingo to asset management fund Intermediate Capital Group (ICG) for a ‘nominal amount’.
The London private investment trust has served as Buzz Bingo majority shareholder since 2015 – acquiring the Gala Bingo brand for £240 million ahead of previous owner Gala Coral’s merger with Ladbrokes Plc.
Under the majority ownership of Caledonia, during 2019 Gala Bingo would be rebranded as Buzz Bingo with the bingo operator undertaking £40 million makeover of its UK venues, supported with new nationwide advertising campaign.
In its market update, Caledonia detailed that its investment in Buzz Bingo was ‘valued at nil as of 28 February’ as the performance of its asset had been rocked by COVID-19 pandemic the subsequent lockdown restrictions.
Caledonia had led the refinancing of Buzz Bingo during 2020, ploughing £20 million into the bingo operator to sustain its UK venues through national lockdown.
Despite its reorganisation, the extended lockdown period saw Buzz Bingo close down 26 of its 91 bingo halls across the UK, as management cited that it ‘expects an unsustainable operating environment for the foreseeable future’.
Caledonia disclosed that a third national lockdown had led to the requirement for new funding, which the investment trust chose not to take part in.