Melbourne- based private equity company BGH Capital is running the ruler over Australian Venue Co’s business plan and venues around the country, looking to submit a speedy pre-Christmas takeover bid.
Australian Venue Co (AVC) major shareholder KKR reportedly engaged investment bank Jefferies to scope potential buyers in September, with hopes for a new fund to take the New York fund’s slice of the business.
From humble beginnings under Bruce Dixon, AVC has built a collection of more than 140 venues in recent years, plus inked a partnership with Coles for its Spirit Hotels portfolio. The acquisitive group has identified in the region of 2,000 more venues that could fit its investment strategy.
It is aiming for north of $1 billion in revenue this financial year.
BGH Capital is one of the remaining parties stemming from the Jefferies talks, but may not be the only one still considering an offer.
BGH was established in 2017 by founding partners and former business bankers Robin Bishop, Ben Gray, and Simon Harle, and is headquartered in Melbourne. Mid-2018 the BGH Capital Fund I closed at approximately A$2.6 billion, and the Capital Fund II closed in February this year at $3.6 billion.
To date the entity has gathered a diverse portfolio including a university pathway provider (Navitas) and cyber security experts (CyberCX) and several healthcare-related assets (ForHealth, Albano Healthcare, Virtus Health).
But it has also secured the titles to several businesses that could prove complementary to a national hospitality group, such as artisan bakery Laurent, chicken producer Hazeldenes, online travel agent TripaDeal and entertainment icon Village Roadshow, which holds six theme park-style entertainment venues on the Gold Coast and Australia’s largest cinema chain through a JV with Event.
BGH took an interest in the even larger Endeavour Group prior to its spin-off listing last year by majority owners Woolworths and the Mathieson family, but is understood to not have met the higher asking price.
This time around the fund is understood to have engaged Goldman Sachs and solicitors Gilbert + Tobin to steer due diligence and any subsequent negotiations, as forerunner to a push with KKR for a quick deal.
AVC CEO Paul Waterson declined to comment on the process at this stage, suggesting there is “still a long way to go” in any agreement.