Phoenix sells Riviera to Silverfleet

Kenny Wastell
14 December 2017

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Phoenix Equity Partners has sold Riviera Travel, a UK-based provider of escorted overseas holidays and cruises, to buy-and-build specialist Silverfleet Capital.

Financial details of the transaction remain undisclosed, though Silverfleet is currently investing from its €870m second fund, which closed in June 2015 and targets businesses with enterprise values of €75-250m.

The deal comes six months after the Sunday Times reported that Riviera had been put up for sale by Phoenix. At the time, the business was reportedly expected to fetch a valuation in the region of £250m.

The transaction is the eighth exit for the vendor's £450m Phoenix Equity Partners 2010 vehicle. A person with knowledge of the situation told unquote" that Phoenix's three largest exits of 2017 – Key Retirement Group, Porthaven Care Homes and Riviera – have generated returns of £400m for the fund.

Under Phoenix's tenure, Riviera has undertaken an international expansion strategy and broadened its range of holidays offered. It is understood the business increased its EBITDA by 80% during the GP's three-year holding period.

The business will continue to expand its product range under its new ownership, in addition to targeting expansion in the US market. It will also invest in new ships and further develop its direct-to-consumer activities.

Debt
According to unquote" sister publication Debtwire, ICG provided a unitranche package of around 3.5x EBITDA to support the acquisition.

Previous funding
Phoenix supported the management buyout of Riviera in December 2014.

Company
Headquartered in Burton-upon-Trent and founded in 1984, Riviera is a provider of overseas escorted holidays and cruises, primarily targeting the over-55s demographic. According to publicly available documents, Riviera's parent group, RTL Topco, generated a turnover of £136m in the year ending November 2016, with operating profit before amortisation of £15m. Debtwire reports that the firm generates EBITDA of £23m.

People
Phoenix Equity Partners – David Burns (managing partner).
Silverfleet Capital – Gareth Whiley, Mark Piasecki (partners); Robert Knight (principal); Sumit Dheir, Adam Ahern (investment executives).
Riviera Travel – David Clemson (CEO).

Advisers
Equity – Alvarez & Marsal (financial due diligence, tax); Parthenon EY (commercial due diligence); Ropes & Gray (legal); Harris Williams (M&A); Deloitte (debt advisory); Intuitus (IT due diligence); PwC (commercial due diligence); AJ Gallagher (insurance due diligence).
Vendor – PwC (corporate finance, financial due diligence); Travers Smith (legal); LEK (commercial due diligence).