Albion Ventures has exited its investment in six cinema sites including locations in Liverpool, London and Exeter.
Cineworld Group, a nationwide cinema chain, has acquired sites from Albion Ventures through a deal which nets the investment firm £12.5 million.
Albion Ventures first invested in the City Screen Group business back in 1999 when it provided £1.2 million to develop the Cambridge Arts Picturehouse.
It then went on to back the creation of the Picturehouse FACT in Liverpool in 2002, Greenwich Picturehouse in 2004 and The Ritzy cinema in Brixton and Exeter Picturehouse in 2005.
Having also provided capital for Cinema City in Norwich in 2007, Albion Ventures then invested addition funds in 2009 to aid with the digitisation of the cinemas.
Henry Stanford, partner at Albion Ventures, comments, ‘We are delighted to have played our part in building up the City Screen group and wish Lyn Goleby and the management team ongoing success under Cineworld’s ownership.
‘Our cinema investments, which were part of Albion Ventures’ asset-backed portfolio, have generated an excellent return for our funds and demonstrate the success of our long-term investment philosophy.’
The details of the deal reveal that, in total, Albion funds invested some £8.6 million. Prior to the £12.5 million received as part of the disposal deal, the firm had also received loan stock interest and other payments and loan stock repayments over the course of the investment totalling £9.6 million.
This means that the funds have received a reported return of 2.6x investment and have realised a capital gain over original cost of approximately £6.5 million.
Lyn Goleby, managing director of City Screen, says that Albion has been a ‘supportive’ long-term investor, which backed up its commitment by reinvesting in the business.
She adds, ‘Their interest in the detailed management and their support for the way we have programmed and run the cinemas has been a great endorsement for the effective working of venture capital.
‘The current sale takes us onto the next phase of development made possible by Albion’s early and consistent backing of the company.’
Albion Ventures is a venture capital investor specialising in VCTs with £230 million under management. The business of Albion Ventures was formerly known as Close Ventures before being acquired by its management in early 2009 from Close Brothers Group.