Private equity firm Connection Capital has sold Teamsport, the UK’s largest indoor go-kart operator, in a deal that has generated a 4.1x return on money in just over four years.
The exit of the business to Duke Street Capital also delivered a 35% IRR.
Teamsport was established in 1992 and provides indoor karting tracks of up to 1km in length which include multi-level karting, banked corners, flyovers and ramps as well as hairpin bends, chicanes and fast straights.
Connection Capital invested £2.8 million in Teamsport in 2013 as part of its £7.73 million management buyout. Since then the business has grown strongly, increasing the number of sites across the UK from 9 to 23, with three more in the pipeline. As a result its EBITDA has risen from £1.6 million in 2013 to a forecast £5.6 million this year.
Teamsport is headquartered in Farnham and employs more than 750 staff, a number which has tripled since Connection Capital’s investment.
Bernard Dale, Private Equity Managing Partner at Connection Capital, said, “Teamsport has been a tremendous investment for our clients, combining an exciting business with the potential for real, solid business growth. The company has grown significantly through investing in its sites both new and existing, enhancing its customer offer through its dedicated staff, delivering excellent returns on capital invested in new and refurbished sites and consolidating its dominant market position as a national brand.”
Dominic Gaynor, CEO of Teamsport, added: “Connection Capital’s involvement has turbo-charged our business: from opening one or two sites a year we are now opening six. As well as rolling out new sites, the investment also enabled us to invest in our Head Office to support that growth. In addition to their financial backing, they have also been willing to be patient and not look for short term gains as well as providing us with the benefit of their extensive experience.”