A WEALTHY Scottish family’s investment vehicle has become the new owner of Britain’s biggest chain of bingo clubs.

Caledonia Investments, in which the largest shareholding is held by the Cayzer family, has bought Gala Bingo, currently owned by Gala Coral, for £241 million, subject to regulatory approval by the Gambling Commission.

Gala has a 38 per cent share of the UK bingo market, with some 130 clubs with more than 1.1 million active members in the UK.

For the year to September 26, it posted a £33 million pre-tax profit.

Bingo has been enjoying a revival in recent years thanks to growth in online games and the halving of bingo duty in last year’s Budget.

The sale by Gala Coral does not include the GalaBingo.com online bingo operation, which will be retained by the seller.

The disposal of the bingo clubs also removes a major obstacle to the planned merger of Ladbrokes and Gala Coral which will create Britain’s biggest bookmaking operation.

The bingo halls business at Gala Coral was not part of the agreed merger between Gala Coral and Ladbrokes PLC.

The merger between the pair will include the Coral Retail, Eurobet Retail and Coral online business. The bingo arm was not part of the deal, allowing the sale to Caledonia.

A FTSE-250 quoted company with assets of £1.6 billion, Caledonia Investments can trace its history back to Victorian magnate Sir Charles Cayzer.

London-born Cayzer made his fortune through the Clan Line shipping company before buying several Scottish estates.

He was made the first baronet of Gartmore in 1904 and established his family home in the village.

The Caledonia Investment trust also owns shares in AG Barr Ltd, the makers of Barr’s Irn-Bru.

The trust has paid increased dividends in each of the past 48 years.

It used to donate to the Conservative Party though ceased doing so in 2010 after protests from shareholders. A statement released to the Stock Exchange said that Caledonia’s longer term partnership model will help Gala Bingo continue to build its business through investing in the retail estate and the ongoing digitalisation of the bingo product.

Duncan Johnson, the head of unquoted investments at Caledonia, said Gala Bingo’s “defensive, enduring business model, which delivers strong cash generation and dividend yield, fits ideally with the investment criteria sought by Caledonia for its unquoted portfolio and complements our other assets in the unquoted pool.”

Led by chief executive officer Simon Wykes and chief finance officer Alex Wood, Gala Bingo reported gross assets in September of £189.6m.

The completion of the deal is subject to change of control approval of the Gambling Commission and finalisation of a £155m senior debt facility.

Following approval, Caledonia will invest £97.8m in cash to acquire 99.5 per cent of the equity of Gala Bingo, with the management team subscribing a further £0.5m.

Commenting on the acquisition, Johnson continued: “Gala Bingo is well known to Caledonia’s unquoted investments team and we are delighted to be backing Simon Wykes and his team in the next chapter of its history.

“As with our other unquoted investments, Gala Bingo will pay an attractive yield from inception.”

Wykes commented: “We are delighted to have secured Caledonia’s backing in the next phase of Gala Bingo’s development.

“We believe that Caledonia’s longer term, supportive investment model will give Gala Bingo the stable platform from which we can continue to develop our market-leading business.”