M&A activity in travel ‘taking longer’ amid market volatility

Mergers and acquisitions activity in the travel sector remains buoyant but deals are taking longer amid market volatility exacerbated by US president Donald Trump’s tariffs.

Concerns were raised last week when investment firm 3i Group postponed the sale of Audley Travel, with reports citing upheaval in global stock markets creating uncertainty in company valuations.

However, M&A advisors reported continued interest in travel despite transactions becoming more drawn out with higher due diligence requirements.

Martin Alcock, Travel Trade Consultancy director, said: “The pace of transactions has definitely slowed a little this year, and the Trump noise isn’t helping. We’re still actively working on several transactions but processes are taking longer.

"There’s more scrutiny of assumptions in the diligence, a lot more tyre-kicking and general faffing about, but there is still appetite from investors for the right travel business."

Henry Wells, head of consumer at Cavendish, agreed uncertainty is “not good in the M&A deal-making environment”, adding: “We do not see a medium-term marked reduction in the appetite for travel businesses, especially the highest-quality ones.

“The deal-doing environment is tough, largely due to macro uncertainties and, while transactions are taking longer, there are good opportunities for buyers who have conviction.”

Travel deals getting harder
Christopher Jones, managing partner at corporate finance house Clearwater, noted travel deals are getting harder as there are more sellers than buyers.

Commenting on tariffs and economic uncertainty, he added: “M&A thrives on stability, confidence and certainty. They are obviously in shorter supply at the moment, which is not helpful.

“It means it is really important to stand out and businesses that will get funded are the best businesses with the highest degree of differentiation.”

Nicola Sartori, head of consumer industries at Grant Thornton, said: “We haven’t seen any slowdown in deal activity and have seen continued interest from corporates, private equity firms and PE-backed trade buyers. Most of this momentum is concentrated in the small to mid‑sized market.

“Although the press on Audley Travel has been citing market volatility due to US trade policy, outside of this transaction we’re not aware of any deals being paused specifically due to tariffs, but timelines are definitely stretching compared to pre-Covid norms.”