Grand Circle Corp. is being sold to New York
private equity firm Court Square Capital Partners for an
undisclosed amount.
Grand Circle CEO Alan
Lewis and his wife, Harriet Lewis, who acquired Boston-based Grand
Circle in 1985, will retain a 30% stake in the direct-market tour
operator. Alan Lewis will remain on the board but will be replaced
as CEO by Rakesh Gangwal, former CEO of Worldspan, a Court Square
Capital portfolio company. Gangwal left Worldspan when it was
acquired by Travelport earlier this year.
The sale is slated to
close in February.
Harriet Lewis will
also step down from her role as co-chair at Grand Circle and as
chairman of Grand Circle Foundation.
Grand Circle Travel
was created in 1958 to serve AARP members. The Lewises expanded
that business to include all Americans over the age of 50. In 1993,
they acquired Cambridge, Mass.-based Overseas Adventure Travel and
in 1997 they established Grand Circle Small Ship Cruises with a
fleet of more than 50 ships.
Today, Grand Circle
Corp. has 44 offices and employs 3,000 people.
According to the
Lewises, the company has grown from $27 million in sales and 5,000
travelers in 1985 to approximately $760 million in sales and
166,000 travelers in 2007.
Nevertheless, Grand
Circle Corp. ran into some challenges last year after the Better
Business Bureau had given the company an "unsatisfactory" rating.
The rating was due in part to a series of customer complaints about
Grand Circle's cancellation, refund and exchange policies as well
as its customer service.
In response, Grand
Circle changed its cancellation policy to give customers a full
refund if a trip is canceled.
Despite the customer
service hurdle, when the company announced the sale last week, it
said in a statement that "97% of Grand Circle travelers say that
they would travel with the company again."
To
contact reporter Michelle Baran, send e-mail to [email protected].