In a move some may cite as being due to the rising decline in bingo halls across the UK – Coral has sold its Gala Bingo club franchise to the investment trust Caledonia for a staggering prize pot of £241 million. This does not include Gala’s online assets however, which are still going to be run by Coral themselves.
So does this sale really come as a result of economical decline for old-fashioned bingo halls? Are Coral looking to offload Gala and quite literally let it become somebody else’s problem? Well, it turns out that the reason for selling these assets is in fact quite the opposite – Coral believe that Gala is a stronger brand than ever, and the reason for the sale? Further success!
Duncan Johnson, head of investments for Caledonia stated that Gala bingo is an “defensive, enduring business model” and went on to say that the company offers “strong cash generation and an attractive dividend yield that fits ideally with the investment criteria sought by Caledonia.” As it stands, Gala Bingo represents a massive 38 per cent of the UK’s retail bingo market, meaning Caledonia are immediately taking ownership of a massive chunk of the countries overall bingo activity.
Gala Coral’s chief executive Carl Lever said that the sale is simply the next step in a “transformative process” for the Gala Coral group following it’s massive turnaround over the past few years – in the year to September 26th, they had raked in pre tax profits of £33 million, clearly proving that the bingo giant can hold it’s weight in what has been a very tricky economical climate. Duncan Johnson went on further to say that Caledonia’s first port of call is going to be focusing on creating means for people to “interact with the retail bingo offering via smart phones and Ipads from home”, something that would surely be a logical evolutionary step for the company as it would seemingly merge their online offerings with their retail outlets and create a seamless bingo experience for gala lovers across the country to indulge in.
There’s really no telling how fruitful the future of Gala Coral will be as a result of this investment from Caledonia as the success of bingo is very closely tied to the current economic situation in the UK, meaning if another crash comes from out of nowhere, it might just mean that the company faces untold hardship. On the other hand though? There is absolutely no reason to believe this will happen, and it’s a clear no brainer that the injection of cash as a result of the deal, provided it is spent in the right areas, will do nothing but skyrocket Gala’s retail outlets to previously unattainable heights and make one of the nations favourite games more enjoyable than ever before.