July 17th, 2014 | Published in Business
It was the hottest rumor making the rounds at International Bowl Expo in Orlando, and now it has been confirmed: Brunswick is getting out of the bowling business.
Expo rumors centered around Brunswick selling its bowling centers to Bowlmor AMF, a company formed when Bowlmor acquired the AMF-branded center chain.
Now, the company has announced that it also is seeking to sell its bowling products business.
The announcement was made by Brunswick Chairman and Chief Executive Officer Dustan E. McCoy, who recently announced that he would be retiring from the company sometime in 2015.
According to Thomson Reuters One, the price tag for the bowling centers was $270 million, and Brunswick said it anticipated that the sale would be completed within 90 days.
The changing model of the bowling center business — moving away from league based to entertainment focused — and the shrinking size of the industry were cited by McCoy for the company’s decision.
“The bowling industry has been evolving as center counts decline and the customer mix shifts from predominately league bowling to casual bowlers seeking an entertainment-oriented experience,” McCoy told Reuters. “For Brunswick to drive growth in this business, it would take continual development of new entertainment concepts and significant additional investment to implement these new concepts at new properties or to convert existing centers.
“We believe directing investments into select portions of our core Marine operations as well as our Fitness business provide better opportunities for greater returns. In 2013, the Marine and Fitness businesses together accounted for 92 percent of Brunswick’s net revenues.”
Although bowling’s contribution to Brunswick’s bottom line was small when viewed as a percentage, it was not insignificant.
“Brunswick Retail Bowling has long been a solid contributor to our company, and last year had approximately $187 million in sales,” McCoy said. “After careful consideration, however, we concluded that this transaction [with Bowlmor AMF] is in the best interests of our shareholders and the Retail Bowling business.”
With the addition of 85 Brunswick centers, Bowlmor AMF will own and operate 343 centers in North America.
• Check back soon for comments from Bowlmor AMF Chairman Tom Shannon.