Travel: Great Rail Journeys Captures Demand for Experiences

Consumers continue to prioritize experiences, and travel is perhaps the most compelling experience money can buy. In recent years, group travel and travel experiences have emerged as particularly robust and resilient sectors, creating long-term growth opportunities for M&A investors.

Here, senior professionals from our Consumer Group discuss the sector’s enduring appeal and the key reasons why recent client Great Rail Journeys has attracted intense investor interest.

Steady, Long-Term Growth

Travel is a long-term growth market, set to expand at a 6% CAGR between 2024 and 2028.¹ It has also demonstrated that it can bounce back from macroeconomic shocks, including the global financial crisis and the COVID-19 pandemic.

In fact, the large U.S. and U.K. source markets (the markets travelers originate from) are expected to experience significant growth through 2027, driven by strong volume and price trends. Group travel, in particular, is buoyed by favorable demographic trends, notably an aging and increasingly affluent population continually augmenting the core market for these experiences.

Ed Arkus, a managing director, explains that the 55+ demographic is healthier and more active today. “Escorted tours and rail and river cruises are high-growth segments among this population,” he says. “They are increasingly drawn to unique, active travel experiences and value the ease of booking, convenience of a pre-arranged itinerary, tour guide support, and opportunities for socialization.”

“The 55+ population is also highly attractive for travel as they have increased available time and strong levels of affluence,” adds Will Bain, a managing director. “They are often spending on travel from wealth accumulation rather than income, and hence, are a highly resilient demographic. This provides significant protection from the demand variability inherent in vacation travel.”

Great Rail Journeys: Blending Tech With the Human Touch

Great Rail Journeys (GRJ), headquartered in the U.K., is a great example of a company predominantly catering to the 55+ demographic. It offers this population a curated portfolio of premium multi-modal tours in over 40 countries.

“GRJ has grown consistently in recent years by significantly extending its range of tours, its team, and its source markets,” says Managing Director Zach England. “It has a differentiated and authentic product portfolio and, with a strategic acquisition in 2019, is now a major player in the U.S. market for American travelers exploring the world. Given its strength in both the U.K and U.S. source markets, the company has substantial potential for continued expansion over the long term.”

Through the years, GRJ has invested in data and technology, culminating in a digital demand-generation platform that delivers new customer acquisition and growing re-book rates. It has built a seamless process that leverages AI while providing a personal, human touch, which is critically important to the overall customer experience.

GRJ’s technology helps customers more easily browse travel itineraries across offerings unique to GRJ. When the customer is ready to book, an agent connects personally to make sure the itinerary perfectly meets customer needs. While traveling, customers then have a tour guide traveling with them to handle anything unexpected, relieving the stress that can sometimes accompany vacation travel.

“In some industries, businesses are being intermediated by AI, threatening their existence,” says Bain. “GRJ has been able to marry the best attributes from AI with their deep expertise in all areas of itinerary creation, innovation, digital marketing, and customer service. Ultimately, given much of the customer excitement stems from being part of a group tour, brands such as GRJ are well-insulated from any AI threats, which potentially exist in other segments of vacation travel.”

With strong footholds in both the U.S. and U.K, GRJ was an attractive investment opportunity in both geographies. As such, Harris Williams took a global approach to the engagement, raising visibility of the asset to a bespoke list of international strategic buyers, U.S. private equity, and European private equity, thus heightening competitive tension.

“With GRJ’s focus on travel experiences and its digital transformation, the company drew interest from both a travel and a travel tech perspective,” says Arkus. “We continue to see strong interest from investors in top-quality companies within the travel sector, of which GRJ is a great example.”

A Bright Future

The travel sector continues to offer compelling opportunities for M&A investors seeking exposure to resilient, experience-driven businesses. By tapping into favorable demographic trends, meeting robust demand for group travel, and combining technology with the human touch, GRJ represents a blueprint for success in the evolving travel landscape.

“The outcome of this transaction speaks to the potential of innovative travel platforms,” says Bain. “We see a bright future for GRJ and other companies at the intersection of travel and technology.”

To further discuss M&A opportunities in the travel sector, please contact our senior professionals.

1. Forrester Research