Former owner of Dave and Buster’s bets big on Lucky Strike growth
Wellspring Capital Management, LLC has acquired Lucky Strike for an undisclosed amount. The New York-based investment firm is known for its bets on retail and restaurants. Lucky Strike operates experiential restaurant-retailer gaming centers.
Steven Foster and Kevin Troy founded the Sherman Oaks, Calif.-based entertainment centers in 2003. It offers guests access to bowling lanes, craft beer & spirits, trendy food, live music and high-tech games all under one roof.
Wellspring has previously invested in entertainment centers
Wellspring has raised over $4B in initial capital through six funds since 1995. Wellspring has previously invested in Performance Food Group, Checker’s and Dave & Buster’s entertainment centers. Its affiliate acquired Dave & Buster’s in 2005 in a $375M deal consisting of cash for stock and an assumption of debt. It sold the chain for $570M in 2010.
“Lucky Strike represents an exciting opportunity to build on Wellspring’s successful track record in the restaurant and entertainment sectors,” said Matthew Harrison, a Wellspring partner, in the announcement. “The company has built an impressive brand in experiential retail, a standout area of growth within a dramatically shifting retail landscape. Wellspring’s experience in this space through investments such as Dave & Buster’s position us to be value-add partners to Steven, Kevin, and the rest of the Lucky Strike team.”
Lucky Strike prepares for head-to-head with the likes of Punch Bowl Social
And currently, there are 21 Lucky Strikes in 12 states and Washington, D.C. Wellspring may be eyeing the expansion of Punch Bowl Social as a signal of opportunity for experiential, gaming restaurant-retailers. Punch Bowl has expanded rapidly, including new locations opening the first half of 2019 in Dallas, Miami and Washington, D.C. The chain raised $20M from CrowdOut Capital in November, according to Restaurant Business Online. Additionally, Punch Bowl’operates 16 locations and has nine more on the way, according to its online profile.
As Lucky Strike is acquired, it enters a new chapter of growth, with potentially the needed capital to compete with Punch Bowl Social. For Wellspring, five years of managing Dave & Buster’s could create the competencies necessary to help Lucky Strike stake the top claim in the experiential, gaming restaurant-retailer category.
Also, Wellspring did not disclose the terms of the transaction. According to Wellspring’s announcement. McDermott Will & Emery served as its legal counsel during the transaction.
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