Corporate Travel Management (CTM) has entered into a binding agreement to acquire 100% of Helloworld’s corporate and entertainment travel business in Australia and New Zealand for an enterprise value of $175 million on a cash-free, debt-free basis.
Completion of the acquisition is expected to occur in early 2022 and is subject to a number of conditions precedent including most importantly, Australian Competition and Consumer Commission (ACCC) clearance.
Helloworld Corporate operates via the key brands QBT, AOT Hotels, TravelEdge and Show Group in Australia and APX and Atlas Travel in New Zealand.
Its major customers include large-high-quality blue-chip clients, including state and federal governments and agencies across ANZ.
Helloworld says it will continue to focus on its leisure and corporate travel networks, its air consolidation business, the wholesale and inbound businesses and its logistics business as Australia, New Zealand and the South Pacific continue to recover and reopen to the world following the impact of COVID-19.
This recovery is already underway the company reports, with Helloworld recording non-Corporate TTV in November of A$94.8 million, up 50.5% on October 2021 and 191.7% in November 2020.
Andrew Burnes, Helloworld’s CEO and Managing Director, said “We believe that CTM is the right home for our Corporate and Entertainment travel clients in the future. We regard CTM as an excellent operation and know they have particularly high standards of service and proprietary customer technology in the Australian and New Zealand markets and around the globe.”
“While our corporate and entertainment travel businesses are in the early stages of benefiting from the COVID-19 rebound, we believe this transaction is at a compelling valuation to maximise HLO shareholder value and that will allow HLO to focus on operations which pre COVID-19, represented 80% of our TTV. This will allow the business to capitalise on what we expect to be very significant opportunities during the recovery period ahead,” he said.
Jamie Pherous, CTM’s founder and Managing Director, said “We are privileged to be able to acquire these businesses and are excited to be the custodian of such a high-quality portfolio of clients. We feel strongly that we will be able to continue to deliver strong product and service outcomes to their customers with our dedicated focus.”
Integration planning has been undertaken alongside due diligence, with integration expected to be completed within 12 months of completion. One-off integration costs of $5m are expected to be incurred within 12 months post-completion.
Helloworld will provide transitional services to CTM for up to 12 months post-completion.
Find out more: www.travelctm.com