Kings Park Capital reaps 46% IRR on Lakeshore Leisure trade exit

The transaction delivers a money multiple of 3x and an IRR of 46% for KPC's investors, according to a press release. The sale to Capfun's new UK subsidiary follows a "tightly controlled auction process with strong interest across trade and PE buyers with prior experience in the domestic holiday sector," KPC partner Artjom Dashko told Unquote.

LLG was created in July 2019, when KPC partnered with management to acquire a group of underinvested and undermanaged domestic holiday parks, according to the press release. The GP invested from its Fund II, which held a final close on GBP 75,000 in 2015, he said.

KPC aimed to drive performance improvement through targeted capital investment, product and operational innovation. The "relatively short and capitally-intensive" hold, given the asset-backed nature of the business, did not allow the firm to realise any value prior to the exit, said Dashko.

"The business was ready for next stage of development having achieved excellent trading results post-Covid, so that gave us a window of opportunity to exit successfully," he added.

KPC acquired the first two sites that formed LLG (Otter Falls and Clawford Lakes in Devon) in 2019, followed by the addition of a third site in Devon (Lakeview Manor) in early 2020. In 2022, LLG agreed an option to buy a second greenfield site on the North Devon coast (Clovelly Falls).

The GP made several follow-on investments in the portfolio, including in the development of further holiday lodge pitches across the parks, the refurbishment of the hotel and central facilities at Lakeview Manor and a 78-acre greenfield development at Clawford Lakes. Under KPC's ownership, revenues grew at a CAGR of 51% and EBITDA grew at a CAGR of 77%, according to the press release.

LLG was KPC's second investment in the domestic holiday parks sector, having previously partnered with the management team to create Bridge Leisure Parks in 2010, according to the press release.

Company
Lakeshore Leisure Group was created in July 2019, when KPC partnered with its CEO, Stephen Twiss, to pursue a buy-and-build strategy in the UK holiday parks space. It owns and operates three holiday sites in Devon.

People
Lakeshore Leisure Group − Stephen Twiss (CEO).
Kings Park Capital − Artjom Dashko (partner).

Advisers
Vendor − KPMG (corporate finance); Burness Paull (legal).
Management − Wyvern Partners (corporate finance).

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