Close Brothers Private Equity (CBPE) backed the buyout of Luminar’s Enterprise division comprising 49 nightclubs and High Street bars to create the UK’s second largest independent nightclub operator.
The total consideration for the transaction is £28m and the new business will be renamed CanDu Entertainment Group. Luminar is selling the Enterprise division to focus on its core business.
CanDu will comprise 29 nightclubs and 20 High Street bars across the UK, including 13 freehold sites. In the year to February 2005, the division generated sales of £44.1m and site Ebitda of £9.4m.
Some of CBPE’s funding will be used to invest across the CanDu estate, including the repositioning of some of the High Street bars, as well as increasing local marketing initiatives. In addition, CBPE will be actively looking at acquisitions for the nightclub estate.
The buyout is led by Tim Roberts, chief executive, Craig Grant, finance director and Peter Loader, operations executive. Roberts has worked at Luminar for 13 years, managing the Enterprise division for over a year. Grant was formerly head of strategy and planning at Luminar, and held similar roles at Inter Continental Hotels and Bass. Loader was previously managing director of Luminar’s Entertainments division and has spent 25 years working in the leisure industry.
“CanDu is a highly cash-generative business. We believe that we can improve a number of the existing sites through investment and focused management and marketing at a local level. We will also look to expand the business with bolt-on acquisitions,” said Sean Dinnen, a partner at CBPE.
CBPE’s most recent transaction in the leisure sector was its investment in Park Resorts, the caravan park operator, which was recently sold achieving a 7.6x multiple on invested capital.