Investors see 'huge opportunities' in travel market - coverage by travelmole.com

The UK travel industry is continuing to hold its own with investors seeing huge opportunities, despite the wider economic and political concerns caused by Brexit.

This was the conclusion of a report by global~corporate finance~company Clearwater International in its latest analysis of the sector.

It said there was a large number of deals in 2018 and this continues the trend of the 'steady flow of transactions' over the last few years, with many players in the travel industry attracting the interest of private equity investors looking for strong growth opportunities.

"We are likely to see further secondary buy-outs, which were a particular characteristic of the market in 2018, as businesses grow and existing private equity investors look at their exit options. Trade acquirers will also continue to improve their growth rates through mergers and acquisitions," its report, Travel Clearview, said.

It said the growth of the UK travel market in recent years shows little sign of slowing.

"Much of this growth continues to be driven by changing consumer behaviour as holidaymakers shun the traditional two-week beach break in favour of more flexible, exotic and experiential holidays," it said.

Growth continues to be driven by changing consumer behaviour as holidaymakers shun the traditional two-week beach break in favour of more flexible, exotic and experiential holidays.

"At the same time social media is playing an increasing role in holiday choices, with an estimated 61% of millennials influenced to travel to a destination by its potential for Instagram-friendly snaps."

It said growth markets - premium, online, escorted and niche specialist travel - were the segments seeing notable M&A activity with private equity investors particularly active.

It said the growth of the a 'wealthy' over 50s population represents an 'exciting opportunity' for the travel sector.

"Companies have responded by making holidays friendlier to this generation by offering more managed, packaged, and escorted/guided holidays which provide high quality experiences," said the report.

"As such, travel operators in this space are attracting significant attention from investors."

It also identified 'skipgen' travel as a significant trend, particularly in the cruise market, with travel advisers experiencing an increase in the number of requests for trips where grandparents take their grandchildren on holiday, leaving the parents behind.

View the full Travel Clearview publication.

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