LateRooms

• Laterooms is a leading internet intermediary of low cost, late availability hotel rooms to corporate and leisure customers

• Laterooms operated in a fast growing market with high margins and strong historical revenue and earnings growth in its core business. It operated in a channel to market where ECI could demonstrate strong sector credentials
• It was a low cost operating model allowing substantial operating leverage

• John Donaldson, a proven leisure sector Chairman, was introduced to the company at an early stage to work with the incumbent CEO. Senior management was also strengthened with a new finance director introduced by ECI
• Significant investment made in core customer systems to address lack of ‘customer insight’ in the business. Throughout the investment period the business became more sophisticated  in its approach to customer acquisition and development
• Laterooms also invested heavily in managerial and technical staff to professionalise the business whilst retaining the ‘early-growth’ culture
• Debt finance used to refinance out vendor loan notes

Performance

• The growth in the core business exceeded market growth of on-line hotel bookings which was growing at circa 30% p.a. At the time of exit the site was receiving approx one million visitors each month
• Sold to First Choice Group in December 2006 for £108m representing a return of 9.1x cost and a 496% IRR