Leisure group rights issue

European Leisure calls on shareholders for pounds 11m to fund an expans ion of its themed bars and snooker clubs

European Leisure, which was close to going to the wall a couple of years ago under a burgeoning mountain of debt, yesterday tapped shareholders for funds to accelerate the opening programme of its theme bars and Riley snooker clubs. It also announced plans to reduce the number of shares owned by its bankers.

The company plans to double the number of its Liberty and Berlins venue bar formats with five new openings of each, taking total sites to 19. In addition, 10 further Riley's US Pool Lounge sites will be developed, taking total Riley sites to 64.

Some of the pounds 11m rights issue will also be used for research and development of new fruit machines by its Maygay subsidiary, which is benefiting from gaming deregulation.

Commenting on the expansion plans, Ian Rock, chief executive of the company which is best known for its Hippodrome and Camden Palace nightclubs in London, said: "We will be focused about this expansion. These are formats which work so let's stick with them."

European Leisure's balance sheet is in considerably better shape than during the recession, a period when the company's financial problems were compounded by dwindling attendances at its venues.

Mr Rock expects gearing to drop from 85 to 56 per cent once the two- for-three rights issue at 145p per share is completed, and other previously announced share conversions are taken into account. European Leisure's shares rose 4p to 169p on the news.