The UK's second largest ten-pin bowling operator, Ten Entertainment Group PLC (LON:TEG) made a subdued debut on the London Stock Exchange main market this morning, initially scoring a premium but then settling back to its placing price.
In opening conditional deals, Ten Entertainment shares changed hands at a peak of 172p each, around a 4% premium to their 165p placing price, before drifting back to that level after 45 minutes of trading.
The firm, which has 40 sites, had an initial market cap of £107.25mln after the placing of 16.25mln shares, with its entire issued share capital of 65mln shares admitted to the premium listing segment of the LSE's Official List. Unconditional dealings in the shares will to take place from the market open on April 19.
The share offering, which comprised 25% of the company's issued share capital, raised gross proceeds of £26.8mln for the selling shareholders.
Defined growth strategy …
In a statement announcing the placing price yesterday, Alan Hand, Ten Entertainment’s chief executive officer, said: “TEG's experienced management and highly cash generative operating model together with a clearly defined growth strategy will enable us to deliver sustainable and growing returns for shareholders. We look forward to the future with real confidence."
Following the float, private equity firm Harwood Shareholders will control approximately 69.4% of the company’s ordinary share capital, while directors of Ten Entertainment will hold around 5.6% of the group.
The selling shareholders - including the directors - have committed to lock-up arrangements for 12 months with a further 6 month orderly market period.
Numis Securities was the sole sponsor, financial adviser and bookrunner to the company.
Strong growth ...
The firm, which trades under the Ten Pin brand, saw its group revenue has increased from £46.8mln for the financial year ending 28 December 2014 to £67.3mln for full-year 2016, while underlying earnings (EBITDA), adjusted for exceptional items, grew from £5.7mlnto £17.6mln.
On current trading, Ten Entertainment said total sales for the first 12 weeks of full-year 2017 were 9.1% higher than for the same period in the previous year.
It added that like-for-like sales were 5.7% higher against the same period in 2016 which also included an earlier Easter, typically a period of strong trading for the group.
The firm said it intends to distribute approximately 60% of its adjusted profits after tax to shareholders through dividends on approximately a one-third to two-thirds basis between interim and final pay-outs.
--Updates with initial share price --