Inflexion books sunny return on package holiday business

Mid-market buyout firm Inflexion Private Equity has floated UK package Discount Holidays © holiday business On the Beach on the London Stock Exchange after just two years of ownership, securing its fourth public offering in just 18 months. The business, which priced on September 23 despite the latest bout of market volatility, had a market capitalisation of 240 million. Inflexion yielded an unrealised return of 3.6x on the business and an internal rate of return of 84% on the IPO. The firm bought On the Beach from Livingbridge then called Isis Equity1 Partners in October 2013 for 73 million.

Inflexion explored floating the business last year, because the public markets were so hot , Simon Turner2, Inflexion s managing partner told Financial News3. However, it concluded it was a bit early for the business to be sold. It was great actually, because we could update investors a year later and demonstrated that it made a lot of progress. Under Inflexion s ownership, On the Beach invested in R&D, brand awareness and made digital improvements, according to a statement. Downloads of its first mobile app launched last year have exceeded 260,000.

Inflexion, which will retain a 31.7% stake in the business, also helped the company expand into Sweden4. On the Beach s group earnings before interest, taxes, depreciation, and amortisation for the nine months to June 2015 grew by 45% compared with the same period in 2014, Inflexion said. Employees doubled during Inflexion s tenure. It is the fourth time in the last 18 months that Inflexion used the public markets as an exit route for its portfolio companies.

In March, Inflexion netted a 3.7 return when it listed Sanne Group, a trust and fund administration services business, while in June 2014 Inflexion yielded a 16x return on IT services business FDM Group5. A month prior, the firm scooped up a 3.7x return on the initial public offering of National Accident Helpline6, a UK consumer marketing business that has a focus on the personal injury market. The float of the low-cost Discount Holidays © holiday provider marks the first IPO of a travel agency in London since August 2007, according to data provider Dealogic7, when online Chinese travel operator Et-China floated on London s junior market.

It is also the first non-financial IPO to take place in London since the start of September, when City bankers typically return from their summer break. The target was to make the float the first post-summer IPO in London, just before a number of companies are expected to push on with IPO plans after releasing their year-end results, the person said. UK companies which have already announced their intention to float in London this month include UK pharmaceutical firms Acacia Pharma, which develops treatments for patients who feel nauseous after operations, and Shield Therapeutics, which is raising money to launch a product for iron deficiency and kidney disease.

References

  1. ^ Isis Equity (media.efinancialnews.com)
  2. ^ Simon Turner (media.efinancialnews.com)
  3. ^ Financial News (media.efinancialnews.com)
  4. ^ Sweden (media.efinancialnews.com)
  5. ^ FDM Group (media.efinancialnews.com)
  6. ^ National Accident Helpline (media.efinancialnews.com)
  7. ^ Dealogic (media.efinancialnews.com)

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