GI Partners, the private equity owner of UK leisure company Park Resorts, has concluded a nine-month process of negotiation with lenders to restructure the company’s £325 million debt facilities.
The lending syndicate, comprising around a dozen banks led by Bank of Scotland, will take a 5 percent equity stake in the business, leaving GI with a majority stake.
The banks will provide a new £25 million revolving debt facility in order to free up cash to allow the business to undertake an extensive capital expenditure programme, said a statement from GI. The overall debt value and the headline terms remain largely unchanged.
Central to the lenders’ agreement to the new facility was the reinstatement of the business’ founding management team led by chief executive David Vaughan.
Vaughan and his team had been replaced soon after GI’s acquisition of Park Resorts in 2007 in what GI Partners’ managing director Brad Altberger described in an interview with PEO as an “amicable transition”.
The replacement team was a management trio formerly at the helm of motorway services operator Road Chef led by Martin Grant. Under the new management the business underperformed the market and the original management team were subsequently reinstated in December last year. Their return was the “primary catalyst” for the successful restructuring deal, said Altberger.
Park Resorts: A private equity stalwart
Park Resorts, which is the second largest operator of caravan parks in the UK, has passed through the hands of a number of financial sponsors.
The group was originally created by Close Brothers Private Equity – now known as CBPE Capital – via a £46 million carve out from Bourne Leisure. Bourne – a significant player in the British holiday business – was itself owned by private equity firm Legal and General Ventures.
Park Resorts was subsequently bought by ABN AMRO Capital – now known as AAC Capital – in 2004 for £165 million and merged with GB Holiday Parks. GI then acquired the combined group for £440 million in April 2007.
Park Resorts is owned by GI’s second fund, which closed in July 2006 on $1.45 billion. The firm is currently raising its third fund, targeting $2.5 billion. As of June this year the firm had signed nearly $2 billion in commitments, according to market sources.