On 4 December 2003, venture capital firm MidOcean (Europe) sold holiday camp company Center Parcs to Arbor, a company created by institutional investors for the purpose. On completion, Arbor changed its name to Center Parcs (UK) Group and applied for a listing on the stock exchange's Alternative Investment Market (AIM).
Having raised £245m through a placing of ordinary shares, Center Parcs (UK) hoped to recoup the cost of the acquisition and raise further funds through an accelerated IPO. The technique, previously used by Center Parcs broker Collins Stewart for the flotation of Northumbrian Water, would involve the placement of most shares with institutional investors. Whereas an ordinary stock market flotation might take months to organise, the Center Parcs flotation was planned for 11 December, just a week after the acquisition.
To make sure the media understood how and why such an unusual and complicated financial floatation structure worked. To reassure Center Parcs employees and the regional communities dependent on the camps in Suffolk, Bath, the Lake District and Nottingham. To create a strong post-flotation market in the shares of the company.
Strategy and Plan
Although Center Parcs already had a number of institutional investors that would buy blocks of shares, it was essential that a strong market was created for the remaining stock. But stock market regulation on premature disclosure and the tight timing of the deal meant the information would have to be disseminated over a very short time.
On 10 December, Center Parcs held a meeting with analysts following the company to prepare the City for the deal. Journalists on the city pages of the national newspapers were also briefed about the deal at a press conference.
There was no time to organise regional conferences for the local press, so journalists asking how the deal would affect people who worked at the various Center Parcs sites had to be dealt with by phone. Interviews with Center Parcs chairman Martin Robinson and chief executive Martin Dalby were organised with the national press and broadcasters. Dalby appeared on the BBC's Breakfast programme, and Robinson was interviewed on the BBC's Working Lunch and CNBC.
Measurement and Evaluation
Public interest in the Center Parcs brand ensured widespread coverage of the flotation in the national press and on radio and TV The deal was looked at in some depth by The Guardian, the Evening Standard, The Sun and The Sunday Times.
Press cuttings agency Precise Press has collected 192 mentions on the deal since December.
Center Parcs' flotation price on 11 December was 100p, but that rose to 106.5p on the first day of trading. At the height of post-flotation trading, the company's share price hit 109p. On 23 January, the company's share price was back at 106.5p.
Some business journalists expressed concern that the story appeared in the Sunday newspapers on the weekend before the flotation, diminishing the amount of coverage the deal could have received. 'We would have given the deal more coverage if the Sundays hadn't had it in advance,' argues The Sun business editor Ian King.
One senior broadsheet journalist, who declined to be named, disputed the importance of communication with the press as Collins Stewart had already lined up a number of institutional investors. 'I don't think a huge amount of time was spent on communication or explaining the deal to City editors. It all happened very quickly and no one really knew how it worked,' he said.