The Cayzer family’s Caledonia Investments said it agreed terms for the sale of Park Holidays UK, the UK’s third largest holiday park operator, to Tiger Bidco Limited, a special purpose vehicle incorporated by Intermediate Capital Group (IGC) for a headline enterprise value of £362 million.
Caledonia said it will receive £197 million in cash, net of fees, for the sale of its 81.5% fully diluted equity stake.
“The net proceeds represent a premium of 47% to Caledonia’s carrying value of Park Holidays at 30 September 2016 of £134 million and are in addition to £41 million of cumulative distributions that the Caledonia group has received from Park Holidays since it acquired the business in 2013,” said Caledonia.
“Overall, Caledonia will have realised a net IRR (internal rate of return) of 44% and a money multiple of 2.9x from its investment in Park Holidays.”
Caledonia said it acquired Park Holidays in November 2013 for a headline valuation of £172 million.
Caledonia said that at that time, it backed Park Holidays’ incumbent senior management team of CEO Jeff Sills, CFO Al Loch, commercial director Tony Clish and non-executive chairman Adrian Fawcett, all of whom will remain in place following the sale to ICG.
Completion of the transaction is conditional on approval of the Financial Conduct Authority which could take up to three months.
Duncan Johnson, Caledonia’s head of unquoted investments, said: “Caledonia’s unquoted strategy is to invest in leading businesses which combine an ability to grow profits whilst also paying a healthy annual cash return to shareholders.
“Park Holidays has delivered in every respect and we congratulate Jeff Sills and his team, as well as the company’s chairman, Adrian Fawcett, for their stewardship of the business over the past three years.”
Jeff Sills, Park Holidays CEO, said: “We were attracted to Caledonia because of its unique investment model.
“Caledonia has proved to have been a very supportive financial partner over the past three years, which has enabled us both to acquire new sites and improve the quality of our existing estate.
“We look forward to continuing to deliver good returns for our new investor.”
Caledonia CEO Will Wyatt said: “Park Holidays has been an outstanding investment for Caledonia and we are delighted with the progress it has made since we became involved in 2013.
“It exemplifies our ability to find and attract capable management teams and I am delighted that the outcome has been so successful for both us and Jeff Sills and his colleagues.”