Caledonia Investments has cancelled the £250m sale of caravan park operator Park Holidays following June’s Brexit vote.
Park Holidays is Britain’s fourth largest caravan operator, boasting 25 holiday parks in the South of England. Its performance has been buoyed by the rise in staycations, with earnings rising to £35m this year.
When the sale was announced in March the mooted £250m price tag represented a significant increase on the £172m that Caledonia paid for the Hastings-headquartered company in 2013.
But now the private equity firm believes it can generate more from the business if it holds on to it and has set out a strategy to develop growth through acquisitions.
Reporting on the story, the Press Association cited an unnamed source who suggested that Caledonia pulled the sale on the grounds that June’s Brexit referendum would cause earnings to rise much faster as an increasing number of people opt for staycations.
Writing in the Evening Standard, Jim Armitage questioned the motive for the cancellation: “surely if the prospects for a business are good, you don’t just pull the sale, you put the price up or restructure the deal to retain a stake and share in any upside.
“Ditching a sale process five months in – and not long after a refinancing paid Caledonia a bumper dividend – gives the impression potential buyers simply baulked at the price,” he said.
VisitEngland statistics suggest that £1.9bn was spent on holiday parks and caravan trips last year, while around 5.1 million people headed off on breaks within the UK over the August bank holiday weekend, generating £1.3bn for the wider economy.