Deals update – what's happening in the leisure sector?
June 01, 2016
In our 3rd Leisure Deals update, we look to share what’s been keeping us busy and highlight some of the themes we’re seeing and things to look out for. Since our last blog in October 2015, M&A activity in the sector has remained fairly buoyant with the completion of some longer standing processes and new opportunities.
There’s been a good helping of Restaurants on the menu, with casual and fine dining options both whetting investor appetite. Meanwhile the Pure and Vital Ingredient deals highlight a growing hunger for innovative Food to Go options, particularly in the healthy eating segment. Going forward there’s more assets to be served, that said, we have seen some caution creeping in driven by recent softness in market LFLs (fed by increased competition) and continued uncertainty over the full implications of national living wage, apprenticeship levies and property rent & rates. Hopefully this will be no more than a short bout of indigestion, but could lead to some increased debate over price.
Activity within the gym sector has not waned either. Since the sale of LA Fitness and the successful IPO of The Gym in late 2015, we’ve seen a number of other domestic and overseas chains come to market. For some it’s proving a harder work-out but, if rumour has it, we’ll soon be seeing PureGym and Basic-Fit jumping on the IPO treadmill.
The Travel and holiday sector was also booked up this winter. As we predicted, corporate disposals and the continued growth of speciality players and intermediaries have been taking-off, with more to come as TUI’s disposal of its Specialist Holidays business is likely to land soon. Meanwhile, the domestic holiday market remains buoyant with several caravan/holiday park assets attracting attention; after all, we do like to be beside the seaside!
Finally, we continue to see corporate and institutional activity in the gaming sector, and we watch with interest to see how the recent mergers and ongoing regulatory changes play out – place your bets.
How do you see the rest of 2016 playing out? Share your thoughts below or schedule a meeting to discuss your situation in confidence.