Caledonia sells Park Holidays to ICG in £362m deal

Kenny Wastell
19 December 2016

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Listed British trust Caledonia Investments has agreed to sell caravan holiday park operator Park Holidays to Intermediate Capital Group (ICG) in a deal that gives the company an enterprise value of ТЃ362m.

The EV is around 10x the company's anticipated 2016 EBITDA.

The sale will return cash proceeds of £197m to Caledonia in return for its 81.5% stake in the business. The GP had additionally received £41m in returns from the company over the course of its tenure.

In total, Caledonia has generated a 2.9x return from its investment in Park Holidays following a three-year holding period, representing an IRR of 44%, according to a statement issued by the vendor.

Under Caledonia's ownership, the business expanded via the addition of three new holiday parks. In January this year, Caledonia returned 48% of its original investment in Park Holidays, following a refinancing of the company's £165m debt facilities.

Park Holidays' management team will remain in place following the sale to ICG, which is expected to complete within three months, subject to regulatory approval.

Earlier this month, unquote" took an in-depth look at the growing attraction of PE houses to the UK holiday park sector, following the country's vote to leave the EU.

Previous funding
Park Holidays originally came under private ownership in January 2006, when Graphite Capital acquired the company via a £130m buy-in management buyout.

Caledonia then bought Park Holidays in a £172m SBO from Graphite in December 2013, with the vendor netting 2.3x money on the deal.

Company
Coghurst-headquartered Park Holidays is an operator of 26 caravan parks in the south of England, which sells and rents caravans to holiday makers.

Founded as Cinque Ports Leisure in 1985 by Peter Bull and Jim Watson, the company was renamed Park Holidays in 2007 after it was bought by Graphite. According to a statement, it is anticipating EBITDA of £36.5m in 2016, up from £20.4m at the time of Caledonia's initial investment.

People
Caledonia Investments – Duncan Johnson (head of unquoted investments); Andy Powell (director); Tim Lewis (investment director).
Park Holidays – Jeff Sills (CEO); Adrian Fawcett (non-executive chairperson); Al Loch (chief financial officer).

Advisers
Vendor – PwC, Rick Jones (corporate finance); Macfarlanes, Stephen Drewitt (legal); KPMG, Barry Carter (financial due diligence); CIL, Alex Marshall (commercial due diligence).
Management – Wyvern Partners, Martin Kitkatt (corporate finance); DWF, Mark Gibson (legal).