Quadrant could buy Experience as review launched

Quadrant operates The Ghan

Quadrant Private Equity has emerged as a potential buyer of Experience Co’s assets after the company announced it had launched a strategic review.

It comes after speculation emerged in May that the tourism operator is subject to corporate activity, as revealed by DataRoom at the time.

The review will wind up by November and one possible outcome is that Experience Co retains its skydiving operations but sells Adventures Experience, which offers helicopter tours, hot air ballooning, island day trips, canyoning, rainforest tours and rafting.

Quadrant has previously been earmarked as a possible buyer of those assets because it owns Experience Australia, which operates the iconic transcontinental Ghan and Indian Pacific rail businesses and Cruise Whitsundays. It is now understood it will be eager to look at that part of Experience Co should it come up for sale as it also vies for Suncorp’s Capital Smart smash repairs business, which is on the market.

On Friday, Experience Co reported a $48.3 million loss for the 2019 financial year, as an impairment to its Adventure Experiences business impacted the bottom line. Unfavourable weather conditions impacted Adventures Experiences during the financial year, due to wet weather and fewer visitors to the Great Barrier Reef. In that part of the operation, which may sell for about $100m, non-core and surplus assets such as properties and vessels were up for review, the company said. It generated earnings before interest, tax, depreciation and amortisation of $12.4m for the financial year, down 15.7 per cent from the previous corresponding period.

The small tourism operator founded by 33 per cent shareholder Anthony Boucaut, counts former Mantra boss Bob East, who is also chair of Tourism Australia, as its chair and has former Tourism Australia boss John O’Sullivan running its operations. The tourism industry is now a strong performer and attractive at a time when buyout funds and others are looking for mergers and acquisitions.