No Pain, No Gain: The miracle worker looks ready to do it again

Revitalising an ailing company is an arduous task. Ask Nicholas Oppenheim.

Revitalising an ailing company is an arduous task. Ask Nicholas Oppenheim. After a tough battle, he resurrected Northern Leisure, eventually enriching himself and his shareholders when he sold to a rival nightclub chain. Perhaps not surprisingly, he is attempting to repeat the trick.

I don't know how long Mr Oppenheim thought his second rejuvenation process would take. I suspect it has already proved rather more onerous and taken much longer than he originally budgeted. But there now seems to be a reasonable chance that his endeavours are starting to pay off and his vehicle, Georgica, could be emerging as an attractive investment.

He moved in more than four years ago, descending, with powerful City backing, on what seemed to be one of the stock market's perennial strugglers, Allied Leisure. The shares illustrate just what a long, hard slog it has been. After topping 120p they subsequently relapsed to near 35p. They are now 87p, not far from their best level for two years. There is little doubt the group was in something of a mess when Mr Oppenheim arrived. Backed by an array of City institutions, he won control after a spirited skirmish. Allied had already enjoyed a colourful career and, swollen by a round of acquisitions, embraced a disarray of leisure activities including tenpin bowling, snooker, nightclubs, pubs and Burger King. It needed tidying up. But that has proved no easy task.

Peripheral interests have been unloaded. Burger King was sold for £4.75m. In some other instances, long talks with landlords about easing lease terms failed to produced the desired result and Georgica took the extreme step of calling in administrators for some of its operations. It is now concentrating on bowling centres and snooker clubs. In the first years of the new reign, heavy losses were suffered.

But the worst should now be over and although last year's figures will not be scintillating, they should, providing trade over the Christmas period was up to scratch, underline that the recovery is on track.

Borrowings, however, are still high. The summertime figure was about £100m. And many of the group's operations, particularly bowling alleys, have still to enjoy complete refurbishment. It is on the snooker side that the Oppenheim touch has been most evident. Many of the 150 outlets have been revitalised and by the end of this year, it is hoped the entire estate will be in a satisfactory condition and trading under one name, Rileys

In 2003 cue sports turnover was up 4.1 per cent with a 7.6 per cent improvement achieved in the first six months of last year. There is nothing to suggest that progress did not continue in the second half-year. Mr Oppenheim, who has a number of Northern Leisure hands on the Georgica board, has not been slow to tap the stock market. A placing at 75p a share produced £25m. An earlier cash call at 96.5p a share realised £18m.

Shortly after offering shareholders shares at 96.5p, the group attempted to buy out small shareholders with a bid of 87p a share. I criticised the company at the time. It was hardly the sort of manoeuvre that endears the City to small shareholders. I felt then - and still feel - that the cash call should have followed the buy-in.

But there is little point dwelling on past misdemeanours. For investors who are prepared to take a long-term view, the shares, I believe, are worthy of interest. As share tipster Bill Johnston on the watshot.com website says, a purchase and lockaway could reap excellent rewards.

Georgica looks an ideal candidate for the No Pain, No Gain portfolio and I have purchased shares at 87p. It replaces Burtonwood, the pub chain being taken over by the Wolverhampton & Dudley Breweries.

I regarded Burtonwood as a long-term investment. The portfolio acquired the shares at 185.5p in August, 2000. Following the Wolves bid, it sold at 570p. With the founding families enjoying a strong influence, I did not see Burtonwood as a takeover candidate. So the Wolves hunger was a welcome surprise.

Although I regard Georgica as a recovery play, there is a strong possibility of takeover action. Indeed, I would not be at all surprised if Mr Oppenheim cashed in his chips once it is hitting the high spots. After all, he did just that at Northern, which was teetering on the brink of disaster when he arrived. Here, too, he had to endure some early difficulties and there were doubts whether he would succeed. But Northern became a major force in the nightclub business, worth more than £400m when he sold out.