Business and financial advisory firm Grant Thornton UK recorded 11 deals in the sector in the third quarter of 2023, a 10% increase on the previous quarter and a 38% increase year on year.
Grant Thornton said deals were prompted by the post-pandemic demand for travel, adding confidence in the sector was “slowly” starting to rebuild.
It added: “Private equity (PE) interest in the sector has increased this quarter, accounting for 27% of deals in Q3, compared to 10% in Q2. PE deals in the third quarter of the year were characterised by minority investments and fundraisings, demonstrating interest from growth-orientated investors.”
Among notable deals in the period was TravelLocal’s £8.3 million fundraising from investors in September. TravelLocal specialises in tailor-made travel using local experts.
Another was Portman Travel Group’s acquisitions through its Clarity and Destination Sport subsidiaries. In August, Clarity acquired corporate travel management company Agiito from Capita for £36.5 million. In September, Destination Sport announced the acquisition of Sportsworld.
The period also saw the property sector invest in hotels. Sweden’s Pandox AB acquired the Hilton Belfast from Starwood Capital for around £40 million and Henderson Park bought Edinburgh’s Waldorf Astoria for £85 million from UAE-based Lulu Group International.
Nicola Sartori, Grant Thornton’s partner and head of consumer and travel, said: “Following the rebound in overseas travel in 2022, it looks as if appetite for travel companies is here to stay.
“Passenger confidence is starting to feed through to M&A activity as financial investors and trade buyers become more bullish about the sector’s recovery. Private equity interest is also starting to re-build in the sector, with a notable increase in activity this quarter compared to last.”
