A £30 million management buyout of travel ancillaries specialist Holiday Extras as been confirmed today (Wednesday).
The deal, which values the company at almost £100 million, places 55% of the company’s equity into an employee benefit trust.
Long-standing financial partner Natwest funded half of the £30 million transaction, with the remainder covered by medium term shareholder borrowing.
The buy-out lays the foundation to support the growth in shareholder value planned for the next five years, according to the company which claims more than seven million customers.
A 12.7% proportion of the company’s value will be ring-fenced to distribute to employees in the event of a future sale.
Expanding organically and through acquisitions, which include Chauntry Corporation and Purple Parking, planned growth will include new locations across Europe and an “evolved product offering”, both of which will be unveiled later this year.
Group chief executive Matthew Pack said: “Today marks an exciting milestone in Holiday Extras’ development as we set the stage for the future by strengthening the ownership and value of our business, and putting in place an exciting development plan for the next five years.
“Holiday Extras’ experienced management team and dedicated staff are crucial to our future success, and I’m delighted that there is now a robust mechanism in place to share the value of the company with them.”
The management team is led by Pack, supported by deputy CEO Simon Hagger, chief operating officer David Norris and chief financial officer Andrew Parker.
The group board consists of Pack, Parker, along with non-executive chairman Mark Smith and non-executive directors David Kelly and Jeremy Pack.
Gerry and Carol Pack, original founders of the business 35 years ago, said “Holiday Extras is in good hands. The team are brilliant, lively, energetic and progressive. We love the plan and the vision.”
The company, initially conceived to enable travel agents to book airport hotels, now employs 1,000 people with offices in Kent and Munich.
The business has expanded to include airport parking, hotels, airport lounges, travel insurance, short breaks, along with fast-growing car hire and overseas transfers divisions.
More than 100 software engineers, data engineers and data scientists are employed, and last year Holiday Extras was one of the first businesses to embrace ‘one-click buying’ following the expiry of the Amazon patent.
Partners include Tui, Thomas Cook, Saga, Merlin Entertainments, Manchester Airport Group, Allianz, Paultons Park, easyJet, Carnival and Fred Olsen.
Natwest commercial and private banking relationship director Grahame Wells said: “I’m delighted to have Holiday Extras as a client. They have an impressive team, ambitious targets and more importantly offer a brilliant service to the customer and their partners.”