Hambros takes a swing at French golf
HEV, the venture capital arm of the Hambros banking group, has moved into the sports and leisure business with the FFrl30m (£13.6m) acquisition of Blue Green, the largest golf course owner in Europe.
HEV is paying a fraction of the FFr2bn reportedly spent by the French stateowned bank Credit Lyonnais, Blue Green’s previous owner, acquiring and developing the 29 golf courses, seven hotels and various property assets during the late 1980s and early 1990s.
HEV has bought Blue Green which operates mostly in France but also in Belgium, from CDRL the French agency responsible for disposing of the assets of Credit Lyonnais following its recapitalisation by the government.
Although Blue Green – which is forecast to have sales of FFr210m this year – came to dominate the French golf landscape by the end of the last decade, overcapacity in the commercial golf course market, insufficient demand and poor management in the 1990s meant the business was loss making.
However, with the number of golfers growing by 8 per cent a year in France, HEV is confident it can turn Blue Green into a profitable enterprise. “We are buying an asset that is cash flow break-even in a market showing steady growth as golf in France catches up with the rest of Europe,” said Jeremy Hand a director of the investment business.
HEV – which has £333m of funds under management – has installed a new management team to run Blue Green, led by Alain Beja former chief executive of Cobra Golf Europe.
While disposals of some of the company’s courses are likely, HEV may also add to its portfolio at a later stage.
The French golf market is underdeveloped compared to many other European countries.
According to the just-published European Golf Report by the Golf Research Group, the London-based consultancy, France has 273,000 golfers, compared to 3.1m in the UK. With 489 courses, up from just 200 10 years ago, there are simply not enough golfers in France to go around.