Kids join a huge crowd watching the Wiggles as Dreamworld is packed at the start of the school holidays. Pics Adam Head
Kids join a huge crowd watching the Wiggles as Dreamworld is packed at the start of the school holidays. Pics Adam Head

Breakthrough sale for Dreamworld

DREAMWORLD'S parent company Ardent Leisure will have more cash to bolster its theme parks after selling its Bowling & Entertainment division for $160 million to the owners of Timezone.

Ardent announced the sale - worth 27 times what the company netted last year - to The Entertainment and Education Group, in a statement to the ASX this morning, saying the group had approached them and they'd entered a binding agreement to sell.

Elva Liddy is still enjoying regular tenpin bowling at the age of 90. Elva bowling at AMF Bowling Boronia.
Elva Liddy is still enjoying regular tenpin bowling at the age of 90. Elva bowling at AMF Bowling Boronia.

Chairman Gary Weiss said although the division's earnings were improving, the capital from the sale would allow the group to fund more profitable parts of the business.

"Following an unsolicited offer from TEEG, the decision to divest B & E reflects the attractive price offered and our focus on investing our capital in areas where we can earn the most attractive returns," he said.

"This sale relieves Ardent of the requirement to make the significant further investment needed to support this strategy and provides Ardent with increased flexibility to continue the expansion of Main Event and the reinvigoration of Theme Parks."

Ardent had last month flagged closing some of its bowling centres to carve costs from its bottom line after the Dreamworld tragedy saw theme park attendances slump.

TEEG acquired the assets of Timezone Group last month and is jointly owned by funds advised by Quadrant Private Equity and the Steinberg family.

People line up to get into Dreamworld as its packed at the start of the school holidays. Pics Adam Head
People line up to get into Dreamworld as its packed at the start of the school holidays. Pics Adam Head

Ardent are still seeking a CEO for its theme parks division following the shock resignation of Simon Kelly and also for its Main Event operations in the United States.

Interim chief executive officer Geoff Richardson said the entertainment centres, which include an AMF at Robina, would be in good hands with TEEG, which planned to expand them.

"TEEG plans to continue to invest in and grow B & E and we believe the business will have a positive future as part of a larger, diversified operation," he said.

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Completion of the transaction is expected to occur in the first half of 2018 and remains subject to the satisfaction of customary conditions precedent.

The sale price represents a multiple of 27.1x FY17 Core EBITDA less routine capex and 32.0x FY17 Core EXIT, the company said.

Ardent Leisure Group chairman Dr Gary Weiss.
Ardent Leisure Group chairman Dr Gary Weiss.

Dr Weiss said Ardent's strengthened balance sheet position post sale would enhance the group's capacity to execute on the pipeline of high-yielding Main Event entertainment centres in the US and reinvest in the Theme Parks business.

"In Theme Parks our goal is to reinvigorate customer attendance through the introduction of new attractions and further expanding our strategic partnerships, as well as continuing to explore opportunities to develop our surplus land," he said.

"Supported by the ongoing growth in domestic and international visitors to the Gold Coast and the pending development of large scale infrastructure in the nearby Coomera Town Centre, we believe that this reinvestment will result in a material increase in earnings over time."



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