$160m AMF Bowling sale to fund Dreamworld revamp
The listed Ardent Leisure Group will pour the proceeds of its $160 million sale of local bowling alleys and arcades into turning around the performance of iconic Queensland theme parks and its US-based Main Event business.
The two units are all that remain of the once sprawling Ardent empire that one-time manager Macquarie Bank built into an international owner of gyms, marinas and entertainment venues.
The company is now under the command of veteran corporate doctor Gary Weiss, installed after a bitter proxy fight that saw him called on to the board that he now chairs, and the departure of chief executive Simon Kelly shortly afterwards.
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Investors welcomed the rapid sale to The Entertainment & Education Group, jointly owned by funds advised by Quadrant Private Equity and the Steinberg family. The shares rose about 12% to $1.935, as the deal is expected to leave the slimmed down listed company with cash to spend on fixing its remaining assets from a position of strength.
“It gives us more financial flexibility to pursue growth opportunities in both Main Event and Dreamworld,” Dr Weiss told The Australian.
“There is material earnings opportunities in both the residual businesses.”
The sale also means Ardent will not need to expend further capital on attempts to fix up its bowling and entertainment unit, and is in keeping with a $1 billion rescue plan unveiled in July, Dr Weiss says. “This is the first step on the journey to restore value at Ardent,” he said.
The business runs AMF Bowling Centres, Kingpin bowling lanes and Playtime arcades across Australasia, and the proceeds will help the group revamp Dreamworld.
The park is slowly recovering from a 2016 accident in which four people were killed on a white-water rafting ride.
Kelly resigned in November and a search is under way for a successor.
Dr Weiss told investors the hunt for a new CEO for the US-based Main Event business was also a priority.
“We believe there is substantial opportunities in respect of both businesses to improve the earnings profile.”
This article originally appeared on www.theaustralian.com.au/property.