All Leisure group PLC, the UK based destinatiional cruise shipping group, says it has reached an agreement with the shareholders of Page & Moy Travel Group Limited to acquire, on a debt free basis, 100% of the share capital of Page & Moy Travel Group The consideration will be a total of £4.2 million, before deduction of Page & Moy Travel Group’s transaction costs, payable in cash, All Leisure group said in a statement.
Page & Moy Travel Group, a leading tour operator offering holidays to a wide range of overseas destinations, has been offering a broad range of holidays, including touring holidays, city breaks, river and ocean cruises, safaris and classic rail journeys to the over-55s for more than 50 years. It currently trades under 3 brands, Travelsphere, Page & Moy and Just You, selling predominantly directly to its passengers from its dedicated call centre in Market Harborough. In the year to 30 November 2011 the group carried c. 88,000 passengers across its three brands.
All Leisure has a consistent strategy which is to achieve growth by exploiting the increasing demand for destination-led cruise holidays and by providing an increasing choice of other niche holiday products into the over-55 English speaking market. The Directors believe that the Group's chosen niche markets have a number of fundamental attractions:
• Significant barriers to entry. The Directors believe that a growing focus by regulators on safety and consumer protection is raising the barriers to entry for those wishing to enter the Group's markets. This is benefiting established brands with strong balance sheets.
• High levels of repeat business. The Group enjoys significant repeat passenger business, underlining the benefits of customer loyalty.
In realising this strategy, organic growth opportunities will be complemented by strategic acquisitions, reinforcing existing positions as well as increasing All Leisure’s exposure to new and attractive markets.
The Board believes that the acquisition of Page & Moy Travel Group is wholly aligned with this strategy and has excellent commercial rationale, as it both reinforces the Group’s existing positions, offering holidays to customers in the same age profile, and increases All Leisure’s exposure to new markets. The advantages of this transaction include, but are not limited to:
- Page & Moy Travel Group has a large UK customer database which is compatible with All Leisure’s. The enlarged group will have access to a list of nearly 4 million households (mainly 55 and over) and this is expected to lower the cost of customer acquisition
- Opportunities for greater cross selling across brands, particularly to fill All Leisure’s expanded cruise programme
- Reducing dependency on the cruise market, and introducing more balanced global destinations such as China and North America
- Providing numerous synergies across the two businesses - Strong use of scheduled flights will reduce transport costs for fly cruises. Majority of enlarged business will be direct and with both All Leisure and Page & Moy Travel
Group having high level of repeat business.
In the year to 30 November 2011, Page & Moy Travel Group’s revenue was £107.6 million an operating loss of £5.6m and, following the one-off impairment in full of the company’s goodwill of £35.6 million, a loss before tax of £45.1 million. The financial statements for the year ended 30 November 2011 were signed on completion of the deal and will be filed at Companies House within the statutory time limits.
