DLJ Merchant Banking Partners, a private equity investment affiliate of Credit Suisse, has helped Bowmark Capital, a UK mid-market firm, to a four times return on its investment in Education and Adventure Travel,
an educational activity and residential courses provider.
DLJ paid £100 million ($198 million; €125 million) for the business, which has two main brands: School Travel Group (STG) and Kingswood Educational Group. STG is the second largest operator of school and student educational tours and the market leading provider of school ski trips in the UK. It offers a range of curriculum-based products such as tours of battlefields, classical history sites and performing arts venues, and language- and geography-related trips across Europe, the US, China, South Africa, India and other destinations.
Kingswood is the UK’s second largest provider of curriculum-based residential and adventure activity courses. Kingswood operates nine residential sites in the UK and France. Kingswood also operates UK summer camp operator Camp Beaumont.
STG was the product of a series of mergers and acquisitions which began in December 2004 when Bowmark acquired UK school tour operator School Travel Service. STG made four further acquisitions including Equity Travel in 2005, Pavilion Tours in 2006 and Kuoni Student Travel in 2007.
European Capital had been in the front-running to buy the business when the sale process originally began but fell away when the firm curtailed its European buyout activity earlier this year.
Colin Taylor, managing director and partner of DLJ Merchant Banking Partners, said: “The demand for school trips and tours is increasing and the company is well-positioned to capitalise on government and school initiatives to promote learning outside the classroom, as well as teachers’ increasing preference to outsource the organisation of school trips to professional third-party providers.”
Charles Ind, managing partner of Bowmark, which generated an IRR of 63 percent on its £18 million investment, said: “It is effectively a double exit of two portfolio companies that we built up and then combined. It was always the plan. It’s a terrific business with plenty of consolidation potential.”
The Royal Bank of Scotland led a consortium comprising Lloyds TSB, Fortis and Ares Capital Europe which provided acquisition finance for the transaction.
DLJ Merchant Banking Partners was advised by Credit Suisse, DLA Piper and Deloitte (transaction services and corporate finance). DLJ also received advice from Pragma Consulting, Mercer and Marsh.
The management of Education and Adventure Travel was advised by Livingstone Partners and Pinsents Masons.