Graphite buys into UK holiday homes

The UK mid-market specialist has acquired holiday home and caravan group Cinque Ports Leisure in a £130m deal.

Graphite Capital, the UK-focused mid-market private equity firm, has backed a £130 million (€189 million; $230 million) BIMBO (buy-in/management buyout) at Cinque Ports Leisure, the UK’s third-largest holiday home and caravan park group.

Cinque Ports owns 19 family holiday parks on England’s east and south coasts, containing pitches for nearly 10,750 caravans and chalets. The bulk of revenues come from selling the caravans for between £10,000 and £60,000 each and renting the caravan pitches. The firm’s turnover was more than £41 million last year.

The business was founded 20 years ago by Jim Watson, who is retiring, and Peter Bull, who will remain as a director following the deal and will oversee the firm’s acquisition programme.

An incoming management team is led by new CEO Jeff Sills, who was previously CEO of the Tom Cobleigh and Landmark public house chains. Michael Jolly, the former CEO and chairman of Madame Tussauds, joins as chairman; while Tony Clish, a director at Great British Holiday Parks prior to its sale, becomes commercial director.

In a statement, Graphite said future growth at Cinque Ports would come from further caravan sales and upgrades; the exploitation of undeveloped pitches; the provision of additional facilities such as restaurants, bars and entertainment); and strategic acquisitions.

Cinque Ports is an attractive, high margin, asset-based investment with a good track record

David Williams, partner, Graphite Capital

Said Graphite partner David Williams: “Cinque Ports is an attractive, high margin, asset-based investment with a good track record and scope for considerable growth in the future under its new management team.”

The deal was the first worked on in his new role on by Williams, who joined Graphite recently from Sand Aire Private Equity, and also by Mike Innes, who joined as an investment director from Bank of Scotland. Existing team member Simon ffitch was also involved in the deal.

Graphite provided £33 million in equity for the deal and negotiated a debt package from the Royal Bank of Scotland, including a ‘substantial’ facility for acquisitions. Peter Bull has re-invested some of his proceeds from the sale, and members of the new management team have also committed funds.