UK caravan park operator Park Resorts merges with rival Parkdean Holidays
01 September 2015
Caravan park operator Park Resorts had merged with rival Parkdean Holidays to create a near-£1 billion giant with over 70 sites around the UK.
Electra Private Equity, the majority owner of Park Resorts, said today that the new company would generate adjusted profits of over £100 million and that the deal had an enterprise value of £960 million.
The enlarged group would be the largest in the UK with 73 holiday homes and caravan sites across the UK. Electra would hold a 45-per cent equity stake in the business.
The deal would need to be approved by The Competition and Markets Authority.
The deal was thought to be the largest in the holiday parks sector since Rank Holidays was bought by Bourne Leisure 15 years ago.
Electra's first invested in Park Resorts came in 2012 while Alchemy Partners bought Parkdean in 2006.
Additionally, Electra had also agreed a £550 million debt facility with Barclays, Royal Bank of Scotland and JP Morgan in a refinancing deal that would return £96 million in cash to the buy-out house.
''What started as an investment in Park Resorts' senior debt has now become an equity position in a business of real scale and with strong growth prospects in the UK domestic holiday sector,'' said Alex Fortescue, chief investment partner at Electra.
Park Resorts chairman Alan Parker said the two firms ''are an outstanding strategic fit with highly complementary estate and revenues mixes''.
Electra would receive cash proceeds of £106 million, equivalent to 81 per cent of its original investment cost and would retain a 45 per cent stake in the combined business with the completion of the deal.
In 2012, Electra Private Equity invested £70 million to acquire senior debt with a face value of £130 million, in the Park Resorts business, which was then facing hard times.
Electra took a majority stake in the company in 2013 before investing a further £62 million towards funding acquisitions made by Park in 2013 and 2014.