Phoenix has Announced Investment in Forest Holidays
Forest Holidays expands investor base to fund further expansion Forest Holidays (or the “Company”), which owns and operates secluded eco-cabins and treehouses on nine sites across Britain’s National Forests, has announced that Phoenix Equity Partners (or “Phoenix”), the mid-market private equity firm, is acquiring a controlling stake alongside existing shareholders the Forestry Commission and LDC.
The investment by Phoenix will help finance the development of existing locations and the opening of new eco-friendly holiday locations, continuing the Company’s strong growth, and offering numerous opportunities for further development. Phoenix brings financial resources, experience, and a track record of growing businesses in the consumer & leisure sector, making them excellent partners for the Company, its management team and existing shareholders. With the support of Phoenix, the Forest Holidays team will continue to grow the business, with a plan to open at least five new sites over the next five years.
Forest Holidays has a long-term strategic partnership with the Forestry Commission under which the Company operates exclusively on its estate. The Company has grown strongly since the initial investment by LDC in 2012, with EBITDA increasing from under £1m to in excess of £10m. The company now has 571 cabins across nine sites, with a further two in development in Snowdonia and the Brecon Beacons. On completion of those two sites, over half of its locations will be within National Parks.
Forest Holidays’ purpose is to create positive experiences in Britain’s amazing forests; connecting people, nature and local communities. The Company’s cabins are sensitively planned around the existing forest, with minimal felling, strategic re-planting, and a very low environmental footprint due to the use of sustainable materials, such as air-source heat pumps, hydroelectric plants, and a dark skies policy across its estate. Each location is designed specifically to integrate into the forest environment, keeping open access for wildlife, local communities and visitors. Forest Holidays supports domestic rural tourism with an average sustainable contribution of £2m per annum and 60 jobs per site, benefitting the local economy.
Following completion of the transaction, the Forestry Commission, LDC, and the management team will each retain significant minority stakes.
Bruce McKendrick, Chief Executive of Forest Holidays, commented: “Forest Holidays’ strategy and vision has enabled the Company to grow to 571 cabins in nine stunning locations across the UK. I am delighted to welcome Phoenix to the team at Forest Holidays, and I am looking forward to working with them. The Forestry Commission have been and will continue to be a key long term partner. I would like to thank them for their support in helping us achieve our success to date. I am also grateful to LDC for their faith in investing in the Company in 2012, and for being a very supportive partner over the last five years. We are delighted they are staying on board. I am convinced that the alignment of existing shareholders, coupled with the catalyst of Phoenix’s investment, will create a fabulous opportunity to deliver the next exciting phase of the Company’s growth.”
David Burns, Managing Partner of Phoenix, commented: “As experienced investors in the leisure sector, we have been watching the progress of Forest Holidays with great interest. This fabulous business offers a truly differentiated proposition to the UK holidaymaker, and feedback from its customers is consistently outstanding. We are delighted to be joining Bruce, his team and the existing shareholders to help support the continued development and growth of Forest Holidays, through enhancing its existing estate and opening new sites in Britain’s beautiful woodlands.”
Simon Hodgson, Chief Executive of Forest Enterprise, the Forestry Commission’s land management agency in England, commented: “This new investment reflects the strength of Forest Holidays and their vision for sustained, responsible growth. Over the years the high-quality, sensitively built holiday cabins have offered great opportunities for people to experience the forests we manage in a new, tranquil way. We have also been able to invest the income they generate in maintaining and improving the forests for everyone. It is important to the Forestry Commission to remain a shareholder in Forest Holidays, as well as their landlord, to maximise the benefits to the nation’s forests.”
Martin Draper, CEO of LDC, commented: “During our five year partnership with Forest Holidays, we’ve continually been impressed by the ambition of Bruce and the management team. They’ve maintained a clear vision on how to generate growth, and as a result of strong demand have more than doubled cabin numbers. We look forward to continuing our partnership as we support the business on the next phase of its expansion. Alongside Phoenix, we’ll be helping the team in continuing to deliver leading luxury accommodation in a growing staycation market, as part of our commitment to backing ambitious businesses in the Midlands.”
Phoenix were advised by Deloitte and Eversheds, and Forest Holidays were advised by PwC and Gowlings.
About Forest Holidays:
The concept that was to become Forest Holidays came into being in 1973 when the Forestry Commission built a number of cabins on the edge of woodland next to Loch Lubnaig at Strathyre. Over time, more cabins were opened at Deerpark in Cornwall and Keldy in North Yorkshire and in May 2006 the Caravanning and Camping Club won the tender to manage the cabin locations. Forest Holidays was born.
Source: Forest Holidays press release