Ten Entertainment Group PLC (GB:TEG) agreed to a £287 million buyout deal from the U.S.-based private equity firm Trive Capital Partners, sending its shares soaring over 30% on Wednesday. The agreement has been signed between Ten Entertainment and Neon Buyer Limited, which is a recently established company indirectly owned by investment funds advised by Trive Capital.
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Over the past 12 months, Ten Entertainment’s share price has surged by 32%, driven by an increasing demand for in-person leisure experiences in the wake of the pandemic.
Ten Entertainment Group is a leading operator of entertainment centers in the UK, boasting a comprehensive network of 52 centers across the country. The company provides a wide range of family-focused entertainment options in addition to its core bowling centers.
Lucrative Offer for Shareholders
As part of the deal, Ten’s shareholders will receive 412.5p in cash in exchange for each share held in the company. The price indicates a significant premium of around 33% compared to the stock’s closing price of 310p on December 5, 2023. The price also reflects a 23% increase from the stock’s all-time high of 334.5p in Q1 2020 and a 150% rise compared to the IPO price of 165.0p in 2017.
The company’s Chairman, Adam Bellamy, stated that TEG has demonstrated commendable performance in the public markets, with the acquisition allowing shareholders to exit with a price reflecting the core value of the business. He further added that the directors are happy with the price offered by Trive and will confidently recommend the offer to shareholders.
Additionally, Trive Capital believes that the transition to private ownership will lead to substantial growth through “continuous investments in organic initiatives and strategic acquisitions.”
Ten Entertainment Share Price Forecast
On TipRanks, TEG stock has received a Moderate Buy rating based on one Buy recommendation from Berenberg Bank analyst Jack Cummings. The share price forecast is 390p, which is 4.6% lower than the current trading levels.
