LDC reaps 3x return from sale of Atcore to Inflexion

Kenny Wastell
15 November 2017

Tweet
Facebook
LinkedIn
Google plus
Send to

LDC has sold Atcore, a UK-based provider of reservation software for the travel industry, to Inflexion Private Equity after a three-and-a-half-year holding period.

Financial details of the transaction remain undisclosed, though the sale generated a 3x multiple for LDC and the business reported EBITDA of £8.2m in its most recent financial year, according to a statement.

Inflexion declined to comment on the deal valuation, though a spokesperson for the acquirer told unquote" it drew capital from its £650m vehicle Inflexion Buyout Fund IV, which provides equity tickets in the £15-75m range. Last year, the firm raised a £250m supplemental vehicle to invest alongside its fourth fund, with the potential to invest a further £10-20m of equity in deals.

Under the vendor's tenure, Atcore has invested in product development, with a particular focus on a search engine and e-commerce platform. In December 2015, the business bolted on Tigerbay, which provided it with a product specifically tailored towards tour operators.

Atcore also made a number of changes to its senior management team, most notably promoting its chief commercial officer Dave Cruickshank to CEO in May 2016. Following the promotion of Cruickshank, Atcore's then CEO Mike Kingswood moved into the role of non-executive director.

Atcore will look to expand internationally under Inflexion's stewardship, with a particular focus on the Asian and South American markets. It will also seek to make further bolt-on acquisitions.

As part of the deal, Inflexion partners John Harper and Gareth Healy will take a seat on the Atcore board.

Inflexion has made numerous investments in the travel sector, most recently acquiring corporate travel business Reed & Mackay from ECI Partners and Livingbridge in August last year. Other investments include the acquisitions of luxury holiday provider Scott Dunn in December 2014, online travel agent On the Beach in October 2013, and cruise company Griffin Global Group in December 2009.

Previous funding
LDC backed the £45m management buyout of Atcore (then known as Anite Travel) from trade vendor Anite in May 2014. The transaction was led by then-CEO Kingswood.

Company
Slough-headquartered Atcore was founded in 1980 as the travel division of Anite. The business provides reservation software for travel businesses and tour operators, including Thomas Cook, TUI, Centre Parks, Mark Warner, Newmarket and Voyages Jules Verne. Its platforms incorporate inventory, pricing, booking and distribution. According to a statement issued by the vendor, Atcore generated a turnover of £26m in its most recent financial year.

People
LDC – David Bains (investment director); Andy Lyndon (head of LDC Midlands).
Inflexion Private Equity – Simon Turner (managing partner); John Harper, Gareth Healy (partners); Henry Arundel (investment executive).
Atcore – Dave Cruickshank (CEO).

Advisers
Vendor – Deloitte (corporate finance); Gowling (legal); PwC (financial due diligence).
Equity – Evercore (corporate finance); CMS (legal).
Management – Livingstone Partners (corporate finance); Cooley (legal).