Back in 2022, we released data showing that financially pressed consumers were prioritising holidays above other household spending. That trend has firmly held, with research from trade association Abta showing that more than two-thirds of UK households plan to travel abroad in 2025.

 

The ongoing consumer commitment to travel is reflected in soaring M&A, as buyers and lenders view the sector as increasingly robust.

 

At the beginning of the year, our conversations with clients on both sides of M&A indicated that confidence in the travel sector had returned.

 

As the year progressed, deals took longer than expected as investors carried out stringent due diligence while companies experienced changes in booking patterns and waited for clarity on the UK economy and the results of global elections.

 

We saw a jump in Q4 numbers as those deals completed, suggesting travel M&A has finally returned to full swing.

 

Travel deal volumes continue upward march

 

2024 ended on a high, with Q4 deal volumes up 15% on the previous quarter and a striking 130% on the same quarter of the previous year.

 

This took annual deal totals to 79, almost double 2023 numbers and the busiest year since we began monitoring activity in 2018.

 

The number of transactions involving trade buyers continued to grow as travel companies had breathing space to focus on strategy after years of responding to the upheaval of the global pandemic.

 

Meanwhile, 2024 was a quiet year for UK IPOs, including travel. Indeed, the biggest public markets event for the sector was Tui’s delisting from the London Stock Exchange (LSE) in June.

 

Private equity’s record involvement  

 

Private equity (PE) involvement in travel M&A increased by 57% in Q4 2024 compared to Q3 2024 (11 v seven deals) and leapt 450% compared to the same quarter in the prior year.

 

In 2024 as a whole, PE was responsible for 40% of travel M&A, compared to 22% in 2023. Its confidence in the sector can be summed up by KKR’s statement on its acquisition of 33 UK hotels in December: “Our purchase…reflects our conviction in the UK and the opportunity we see to invest behind strong fundamentals and long-term growth in the European hospitality sector.”

 

PE targets growth opportunities

 

We were pleased to support our client, Soho Square, in its growth investment in Newmarket Holidays in October 2024. The UK-based escorted tour operator’s fastest-growing segment is long-haul tours, including destinations like Zimbabwe and India.

 

Smaller deals helped drive Q4 PE volumes

 

PE demonstrated its confidence in existing travel assets with bolt-on deals in Q4 2024 while banking on growth with minority stakes.

 

– Artisan Travel Holdings buys Travel Editions

In November 2024, tailor-made tour operator Artisan Travel Holdings acquired Travel Editions, provider of escorted tours on art and history. Panoramic Growth Equity backs Artisan, which operates a stable of travel brands, including The Aurora Zone, dedicated to trips to see the northern lights.

 

– VOSAIO buys Operation Europe

In November 2024, VOSAIO acquired fellow B2B group-travel service provider Operation Europe. In May 2024, BGF took a multi-million minority stake in VOSAIO.

 

– Host & Stay continues acquisition strategy

In November 2024, short-term rental management company Host & Stay continued its buy-and-build strategy with the purchase of Peak Staycations and Peak Cottage Management, its fifth acquisition of the year. Growth Partner took a £10.5 million minority stake in Host & Stay in September 2024.

 

– Financial investors back B-Corps

 

Two deals involving B-Corps reflect growing consumer demand for socially responsible travel.

 

– Gresham House buys Much Better Adventures

 

In December 2024, UK-based Gresham House invested in Much Better Adventures, a B-Corp active outdoor adventure specialist with a focus on “lower-impact” travel. Much Better Adventures partners with local, independent tourism businesses. Gresham House is also an investor in TravelLocal, which connects consumers with experts in their chosen destination.

 

– Inside Travel Group completes MBO

 

In November 2024, Piper Private Equity and Japanese sovereign wealth fund Cool Japan backed the MBO of Inside Travel Group, a B-Corp which specialises in Asia-focused travel adventure. The group’s InsideJapan and InsideAsia brands promise access to “off-radar sites and hands-on experiences”.

 

In Q4 2024, the majority (56%) of transactions involved travel and tour operators, with hotels accounting for 44% of activity.

 

Domestic deals dominate

 

Overseas investment in UK assets accounted for 35% of deals, compared to 40% in Q3 2024

  • UK-based entities buying overseas assets accounted for 13% of deals, in line with Q3 2024
  • Domestic-to-domestic was the most popular transaction type, accounting for 52% of all deals compared to 45% in Q3 2024

Q4 cross-border deals 

 

– Gray Dawes continues acquisition spree

 

In November 2024, UK-based travel management company Gray Dawes Group acquired Australia’s Verve Travel and Leisure. This is Gray Dawes’s sixteenth acquisition in recent years as it executes an impressive buy-and-build strategy. In 2024, it also bought Dutch firm VCK Travel.

 

– US firm scoops up gap year specialist

 

In October 2024, America’s International Training and Exchange (Intrax) bought 360 Gap, a UK-based gap year specialist. Intrax specialises in cultural and educational exchanges, such as working holidays in the USA, internships, camp counsellor placements, and high-school exchanges.

 

– Talma increases UK footprint with Blue Cube deal

In October 2024, Israel-based Talma Travel Solutions acquired UK business travel management company Blue Cube to bolt on to its previous UK acquisition, Norad, which it acquired in March 2022.

 

Hotels

 

There were 29 deals in 2024 compared to 21 in 2023.

 

There were eight hotel deals in Q4 2024 compared to nine in Q3 2024 and seven in the same quarter last year.

 

Q4 hotel deals

  • In December 2024, a joint venture between KKR and Baupost purchased 33 Marriott International Hotels in the UK from ADIA, a subsidiary of the Abu Dhabi Investment Authority.
  • In November 2024, Trinity Investments, Oaktree Capital Management and Partners Group acquired the 266-room Standard Hotel in London.
  • In October 2024, Singapore-based hospitality group CDL Hospitality Trusts acquired Hotel Indigo Exeter. The 104-room hotel was converted from a former House of Fraser store.
  • In October 2024, a consortium including US singer Pharrell Williams, Cyprus-based Mohari Hospitality, and the UK’s Omnam Group acquired the 5-star Hôtel Saint-James & Albany in Paris.

In the second part of this article, Nicola will look at the trends likely to shape dealmaking in 2025.



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