Irving, Texas – As Reported by CBS News, “Chuck E. Cheese is returning to the public markets. CEC Entertainment, which owns 750 Chuck E. Cheese and Peter Piper Pizza stores in the U.S. and abroad, expects to begin trading on the New York Stock Exchange under the ticker “CEC” in the second quarter 2019. It’s the first time since 2015 that a restaurant chain will go public in the U.S. The last IPO was Brazilian steakhouse chain, Fogo de Chao.” Note that in 2014 Apollo Global Management, a private equity firm purchased CEC and took it private.
One year prior, Dave & Buster’s Entertainment, a location-based entertainment center (LBE) chain currently operating 126 locations in the U.S. and Canada, with food/beverage & amusement games has more than tripled its share price to $53.
Dave & Buster’s Entertainment, a food-and-arcade chain similar to Chuck E. Cheese, has more than tripled its share price to $53 since it went public in 2014. That was the same year CEC was bought by private equity firm Apollo Global Management and taken private.
The really big news is, “The company anticipates an initial valuation of $1.4 billion, and Apollo will own a 51 percent stake.”
What this could mean? The industry has been closely following CEC as it purchased Peter Piper Pizza and then streamlined all its store operations by installing Semnox Debit Card Systems throughout the chain. The results have been positive and we can see why now is a great time to go public and raise additional capital for expansion.
My take is that Peter Piper Pizza is ripe for expansion. Apollo will also be in a stronger position to obtain attractive new store leases as malls and strip centers are looking for strong tenants and the family entertainment center sector is ‘hot’.
It looks like the new public mouse will get a bigger piece of the entertainment pie, in this case, the pie is a cheese pizza!