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Exit and Growth Strategies for Middle Market Businesses

M&A Quarterly News In The Hospitality and Leisure Industry Sector

By David Hulett | Feb 19, 2019

The report below gives a good overview of the first quarter M&A activity in the Hospitality & Leisure Industry Sector. M&A activity for North American based target companies in the Hospitality and Leisure sector for Q4 2018 included 67 closed deals, according to data published by industry data tracker FactSet.

One of the notable middle market transactions was closed in December when Pamplona Capital Management LLP, a subsidiary of Pamplona PE Investments Holding Ltd, acquired Latham Pool Products, Inc., a portfolio company of Wynnchurch Capital LLC and Franklin Square Holdings LP, for US$375 million in cash. The acquisition is in line with Pamplona Capital Management’s investment strategy. Following the transaction, Wynnchurch Capital LLC would retain minority stake in Latham Pool Products. Founded in 1956, Latham Pool Products is located in Latham, New York and manufactures inground residential swimming pools and components.

The hospitality sector has benefitted from a strong economy, which has enabled hotels and motels across the globe to continue to increase rate pricing.

Industry Indicators

  • US consumer spending on services, an indicator of lodging revenues, rose 2.5% in October 2018 compared to the same month in 2017.
  • US corporate profits, an indicator of corporate demand for lodging, rose 10.3% in the third quarter of 2018 compared to the same period in 2017.
  • The value of US nonresidential construction spending, an indicator of lodging demand, rose 5.2% year-to-date in October 2018 compared to the same period in 2017.
  • US personal income, which drives travel activity, rose 4.3% in October 2018 compared to the same month in 2017.
    Total US revenue for accommodation fell 2.4% in the third quarter of 2018 compared to the previous year.

Posted by David Hulett.

Read the Entire Hospitality & Leisure 1st Quarter Newsletter Here


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