Ellerston Capital buys stake in Luxury Escapes at $525M valuation

What's the deal? Ellerston CapitalDealroom has a profile for this one. Try Dealroom → is set to acquire a stake in Luxury Escapes, the online travel platform co-founded by Adam Schwab in 2013. The Sydney-based investment house is targeting a shareholding of at least 12%, in a deal valuing the company at $525 million.

The terms: Alongside the stake, Ellerston has negotiated the right to appoint one board member. The deal value itself was not disclosed.

What's the endgame? Ellerston expects to more than double its money and generate a 5% dividend yield, excluding franking, before exiting in two to three years, according to an investor deck. That timeline points to a defined return target rather than a long-term hold.

The signal: The bet from Ashok Jacob's firm signals confidence in the online travel sector, backing an established platform with a clear path to exit.

Image credit: Ibrahim Asad's PHotography