M&A Leisure deal flow bulletin - March edition
13 April 2017
Welcome to the March edition of M&A Leisure deal flow bulletin – the BDO M&A Leisure team's monthly overview of the latest M&A activity we've seen in the leisure space.
Travel deal flow
- Airbnb has raised $1bn of fresh investment funding to facilitate further expansion in a campaign that began last June. The deal values the company at c$30bn. The company has raised in excess of £3.5bn since its launch in 2008.
- Generator Hostels, a predominantly European group of 'design led' hostels has been purchased by Queensgate Investments who intend to increase the number of hotel assets. Patron Capital and Invesco Real Estate sold the group in a €450m deal.
- Inflexion has halved its stake in listed travel company On the Beach. Shares were valued at 280p and the sale has generated close to £43m, less than two years after the company was floated with a share price of 184p in September 2015. Inflexion now owns less than 12% of the business.
- The River Cruise Line and Diamond Rail Holidays have been bought by Arena Travel after parent company; Diamond Shortbreak Holidays ceased trading due to insurmountable financial problems.
- In the face of rising inflation, a weaker GBP and a host of geopolitical headwinds, we were pleased to see some impressive travel market growth reported in March. Heavyweight multinational TUI reiterated their guidance of "at least 10% growth in Group underlying EBITA in 2016/17" buoyed by strengthening demand for long haul and cruises.
Restaurants and Bars deal flow
- Craft beer 'rebels' and crowdfunding mavericks James Watt and Martin Dickie have sold a 22% stake in BrewDog to US-based TSG Consumer Partners for a reported £213m. The deal values the business at almost £1bn.
- Piper has bitten off a chunk of Flat Iron, taking a minority stake in the business for a reported £10m and valuing the company at c£20m. The 4 site concept will be strategically rolled out in and around London.
- Active Private Equity has taken a minority stake in all-day dining concept Caravan. The investment will go towards bolstering the team and opening new sites across the country.
- Coffee shop and wine bar concept Notes, has agreed a £600k loan from Leon backers OakNorth in order to fund ambitious expansion plans to operate 20 sites in the Capital.
- In a refinancing bid, Stonegate completed the successful pricing of £400m senior secured notes due in 2019. The notes issue will be used to refinance existing bank debt and shareholder loans and provide a shareholder distribution.
- Gusto, the Palatine backed Italian restaurant operator has also been busy securing a further £9m from Santander to support its UK wide expansion.
- Meanwhile, crowdfunding remains an attractive financing option. Curious Restaurants launched a campaign to raise £600k on Crowdcube. Wild Beer Co, based in Somerset, attracted over 1,500 crowdfund investors and exceeded a £1m target in less than a quarter of its 28 day funding period. Burning Night Group opted for a crowdstacker peer to peer fundraiser to secure £4m whilst offering investors a 7% return for a minimum investment of £500.
Other leisure deal flow
- US group Blackstone, has entered an agreement to sell its 21% stake in SeaWorld. Beijing based Zhonghong Zhuoye Group will introduce the brand to China and has agreed to pay $23 a share in a deal that is expected to complete in Q2.
Please contact one of the M&A Leisure team if you would like to discuss any of the topics raised in more detail.
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