Growth capital secured for Generator in stake deal

Generator Dublin
Generator Dublin

The owners of Generator Hostels has completed a 23% minority sale to Invesco Ltd in return for EUR60 (£47m) growth capital.

Majority stakeholder Patron Capital has agreed the deal to provide additional funding for the hostel brand, which is due to add 1, 800 beds in the next year.

The chain currently has 5,200 beds in seven European cities with openings planned in Paris, Rome and Amsterdam.

Josh Wyatt, senior advisor at Patron Capital responsible for the Generator brand, and chief strategic officer at Generator said: “This transaction, via a global institutional capital partner, is a major proof of concept for hostels as an asset class.

“Since Patron acquired Generator in 2007, Generator has built a powerful global brand and revolutionised the hostel experience. The EUR60 million of proceeds cements our valuation premium for Generator and will enable the company to accelerate its growth plans both in Europe and the US, where we believe there is significant potential.”

Carl Michel, Generator’s executive chairman added: “Generator continues to set the pace for the hostel asset class. This transaction is another in a series of firsts for the hostel industry in that a major, global capital partner has acknowledged the strong growth opportunity for Generator and hostels as a wider institutional asset class.

“We intend to use this capital to expand our network to the best-in-class cities where our customers and clients expect to see our world class design, superior room product, and stylized social spaces for both locals and global explorers.”

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