The UK’s five-a-side football market could be in for a shake-up following merger talks between its two biggest players.
Goals Soccer Centres confirmed it was in early-stage talks with its main rival Powerleague about the possibility of combining the two businesses, although it advised that “no decision” had been made.
A merger was among a number of “strategic opportunities” being assessed by the Goals board, who saw the company’s share value increase by 6 percent following yesterday’s announcement.
What a potential merger could mean for the millions of five-a-side footballers in the UK remains to be seen but, given the size of the companies involved, it is likely to face scrutiny from the competition watchdog.
The two five-a-side giants are by far the biggest players in the UK market with almost 100 centres nationwide between them.
Goals also operates two centres in Los Angeles, whilst Powerleague runs venues in Dublin and the Netherlands.
Small-sided football is the most popular and fastest-growing area of adult football in the UK, with over 1.5m adults playing small-sided football every week in England alone.
30,000 teams play in organised and competitive small-sided leagues in England each week, with many players choosing the flexibility and convenience that five-a-side offers over the traditional 11-a-side game.
Goals and Powerleague dominate the five-a-side football landscape in the UK and any deal is likely to attract scrutiny from the Competition and Markets Authority, the government’s competition watchdog.
The CMA would need to decide whether any potential merger would restrict competition within the market and raise the cost of playing five-a-side for consumers.
Goals last year appointed new chief executive Mark Jones before launching a new strategic plan for the business.
They returned pre-tax profits of £3.7m for 2016, having lost £6.2m the previous year – its first annual loss in over 12 years.
Previously listed on the stock exchange, Powerleague was bought by Patron Capital for £42.5m in 2009, a deal which put an enterprise value on the company of around £80m.
Former Powerleague executive chairman Claude Littner – best known as an advisor to Lord Sugar on BBC TV show The Apprentice – welcomed the prospect of a merger, describing it as “long overdue”.