Sunsail Parent buys Moorings Group

by Sail-World on 9 Dec 2005 Sunsail parent company First Choice has announced the acquisition of Grand Expeditions a US based leisure travel group specialising in premium leisure travel experiences from North Castle Partners (a US private equity fund) for a total consideration of £54m.

The Group believes the North American source market offers a substantial growth opportunity in carefully selected niche market segments. Grand Expeditions provides a significant platform to create a leading position in these markets.

The six companies in Grand Expeditions each specialise in a discrete segment of the US premium leisure travel market from group escorted activity adventure, cultural and natural history travel products to bareboat and crewed sailing holiday experiences.

First Choice’s yacht charter business, Sunsail and Grand Expeditions’ business, The Moorings complement each other and will give the Group’s customers access to the widest range of sailing holidays in the main sailing regions of the world.

The Grand Expeditions companies are forecast to achieve revenues of around £70m and recurring EBITDA of £4.5m in the current year to 31 December 2005. The profitability of Grand Expeditions is primarily counter-cyclical to the majority of First Choice businesses.

Synergy benefits of at least an equivalent £4.5m are anticipated as a result of the acquisition. These will arise primarily in the combined yacht charter business.

The well respected and highly experienced Grand Expeditions management team will remain with the business and will help identify, manage and integrate further acquisitions in the region in their market segments.

70% of Grand Expeditions’ business is through direct routes to market.

Commenting on the acquisition, Peter Long, Chief Executive of First Choice said:
'We are delighted that Grand Expeditions will be joining the First Choice Group. We have identified North America as a key source market for us in specialist niche segments. The acquisition of Grand Expeditions is a further development in First Choice’s strategy of becoming a leading international leisure travel company offering a wide portfolio of leisure travel experiences. The companies within Grand Expeditions have significant growth characteristics and first-rate management teams with the drive and dynamism we want in the Group.

By acquiring The Moorings, we are now able to offer the widest choice of sailing experiences in the world and we will ensure that we maximise the opportunities that this brings us. The escorted tours market, particularly at the premium end has been an area we were keen to enter and through this acquisition we have a significant platform from which to develop with leading brands.'

Grand Expeditions operates six companies, principally catering for the 45 – 65 year age groups:

The Moorings – a premier yacht charter company

Travcoa – a premium luxury escorted travel expert with a cultural or historical bias

TCS Expeditions – a leading provider of private jet expeditions around the world

International Expeditions and Park East – providers of premium escorted nature-based tours

Country Walkers – a leading provider of worldwide group escorted walking tours

The Moorings

Established in 1969, The Moorings is a premier yacht chartering company with a reputation for quality of service and innovative fleet product. The Company operates four main brands targeting different customer segments from luxury crewed yachting holidays to high end and entry market bareboat holidays and power yacht vacations. Based in Clearwater, Florida it operates from over 40 bases worldwide with an average fleet size of over 600 boats.

North America is The Moorings key source market, followed by the UK, France and Germany with sales being principally direct. The Company’s largest destination region is the Caribbean with Tortola in the British Virgin Islands being the largest base. Power yacht vacations are increasing in popularity and the management believe that this is a key growth area for the business.

The Moorings and Sunsail are two powerful and complementary businesses which will allow the Group’s worldwide customer base access to the widest range of sailing experiences with the most respected brands in the industry.

Grand Expeditions has an experienced and well respected management team led by Chief Operating Officer Hans Birkholz. The current executive management structure of Grand Expeditions will be retained, with Hans reporting directly into Peter Long, First Choice’s Chief Executive.

In order to maximise the opportunities available to the Group as a result of being able to offer the widest range of yacht charter experiences customers want, it has been decided that the Sunsail yacht charter business will become part of Grand Expeditions, reporting into Hans Birkholz. Peter Cochran and his team will play a key role in the Group’s new enlarged yacht charter business and will become an integral part of Grand Expeditions.

Run separately, Sunsail and The Moorings will be able to leverage off the combined strength of their respective brands and market positioning.