- Webjet has entered into a binding agreement to acquire Destinations of the World for $US173 million ($A240 million).
- Destinations of the World is a market leading B2B hotel room business headquartered in Dubai.
- The deal puts WebBeds, Webjet’s hotel room business, as the clear number two global B2B provider.
Australian online travel site Webjet announced the acquisition of Destinations of the World, a global hotel booking service, for $US173 million ($A240 million).
The deal will be funded by an entitlement offer, debt funding and the issue of new Webjet shares to Destinations of the World management and existing private equity shareholder Gulf Capital. This will represent about 1.6% of Webjet’s issued capital.
Destinations of the World (DOTW ) is a pure-play B2B accommodation wholesale platform, headquartered in Dubai. The company operates in the Middle East, Europe, Asia Pacific and the Americas, connecting hotels with travel retailers.
The deal puts WebBeds, Webjet’s hotel room business, as the clear number two global B2B provider. After the acquisition, WebBeds will have turnover, or TTV (Total Transaction Value), of $A2.09 billion.
“The acquisition of DOTW continues to consolidate WebBeds’ position as the clear #2 player in the global B2B market,” says Webjet’s Managing Director John Guscic.
“DOTW is highly complementary to WebBeds’ existing portfolio and significantly enhances WebBeds’ existing Asia Pacific and Americas businesses, while further expanding its presence in Europe and the Middle East and Africa regions.
“In addition to providing 5600 unique new contracts, the overlap in existing directly contracted hotels will deliver increased depth to our global inventory offering.”
For the 12 months to June, Destinations of the World had EBITDA (earnings before interest, tax, depreciation and amortisation) of $US16.4 million ($A22.7 million).
The Entitlement Offer will raise about $A153 million at $A11.50 a share. Webjet shares last traded at $12.91.
Webjet in August posted a 54% lift in full year revenue to $291 million.