Private equity group to buy Grand Circle

**Ally** · 12-12-2007, 11:44 AM

Quote:

Alan and Harriet Lewis, the owners of Boston-based Grand Circle Corp., confirmed they are selling the company to Court Square Capital Partners, a New York-based private equity firm. The amount was not disclosed.

The deal forms the second private equity move into a cruise-related business announced within a 24-hour period, following yesterday’s acquisition of Regent Seven Seas Cruises by Apollo Management. Apollo is also understood to have looked at Grand Circle.

Alan Lewis said Court Square’s investment will enable the company to grow and build on its reputation for quality, value-oriented vacations. A specialist in the over-50 market, Grand Circle posted $760m in sales and carried 166,000 customers this year.

The Lewis family will retain 30% ownership, and Alan Lewis will serve on Grand Circle’s board. The sale is expected to be finalized in February.

Rakesh Gangwal, the former ceo of technology provider Worldspan, will join Grand Circle as ceo. Alan Lewis will step down from his role as ceo and chairman, and Harriet Lewis from her positions as Grand Circle’s co-chair and chair of Grand Circle Foundation.

The Lewises bought Grand Circle Travel in 1985 and expanded the business from serving members of the American Association of Retired Persons to include any customers over 50 -- more than 1.5m travelers to date.

They acquired Overseas Adventure Travel in 1993 and established Grand Circle Small Ship Cruises, now a fleet of more than 50 small ships, in 1997 to serve Grand Circle Travel and OAT travelers. In 1992, they formed the nonprofit Grand Circle Foundation, which has donated $30m to causes in 48 countries.

Court Square was established by the former members of Citigroup Venture Capital Equity Partners and has invested more than $4.5bn in over 150 transactions, which have returned $14bn to date. The firm has experience in business services, healthcare, industrials, media/publishing, and technology and telecommunications.

Court Square currently manages approximately $6bn of aggregate capital commitments.

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Captain Larry · 12-12-2007, 04:59 PM

Interesting. I have a tour, not a cruise but a land tour, booked through GCT for May and June 2008. I'm sure that this transaction will be transparent for that tour, but what does it bode for the future? Time will tell, I suppose. GCT has been profitable and has a large, dedicated following, persons who feel they are given good value for the money invested in the GCT trips. There are lots of modifications that the new owners could make, and a few of them are positive. But if the goal of the new owners is to milk the company for as much money as possible and then dump it, there'll be one fewer competitor in this crowded business in a few years, and there will be some European River Cruise Boats available at a fairly reasonable price.