Patron and Invesco sell Generator Hostels to Queensgate for €450m

The sale is an exit for Patron's third fund, which first invested in the company 10 years ago.

Queensgate, which typically invests in real estate and property-backed companies, drew capital from its second fund. The GP said in a statement it will look to invest more than €300m in order to support the development of new hostels and bolt-on of additional companies.

Under the vendors' tenure, the hostel operator has increased its number of sites to 14 and expanded into new countries including Ireland, France, Spain, Italy, Denmark, the Netherlands, Sweden and the US. At the time of Patron's initial investment, the company operated out of just two locations in London and Berlin.

The sale of the business to Queensgate is expected to complete in May 2017. A spokesperson for Patron declined to comment on the returns generated by the deal.

Previous funding
Patron first invested in Generator in August 2007, acquiring management operations from a family-owned business and its existing sites in London and Berlin.

Patron then invested a further €150m into the hostel chain to support the acquisition of sites in Paris and Rome in August 2013.

In November of the following year, the GP sold a 23% stake in Generator to Invesco in exchange for €60m of growth capital.

Company
London-based Generator owns and operates 14 sites, two of which are currently under development, across 10 countries. The business was founded in 1995 and generates a turnover of more than €70m, according to the aforementioned statement.

People
Patron Capital – Keith Breslauer (managing director).
Queensgate Investments – Jason Kow (CEO).

Adviser
Vendor (Patron) – Lazard (corporate finance); CMS (legal).
Vendor (Invesco) – Freshfields (legal).
Equity – Brown Rudnick (legal).

• Tweet  
• Facebook  
• LinkedIn  
• Google plus  
• Send to  

• Topics
• Exits
• Buyouts
• UK / Ireland
• Consumer
• United Kingdom
• Patron Capital Partners
• Secondary buyout