Webjet acquisition of Zuji to propel TTV by 30%
December 12, 2012
Webjet today announced it has entered into binding agreements to acquire Zuji in Australia, Hong Kong and Singapore.
Zuji is the number one online travel agency in air tickets in Hong Kong and Singapore, the official packaging partner of Virgin Australia’s Blue Holidays, and has a substantial presence in Australia’s online travel agency space with a total annual TTV in excess of A$300 million. The purchase price is US$25.0 million or approximately 4.6 times pro forma adjusted CY2012E EBITDA.
Zuji is a subsidiary of Travelocity.com LP which is owned by Sabre Holdings Corporation. The acquisition is subject to certain conditions precedent including customary regulatory approvals and is expected to be completed in Q1 2013.
Commenting Webjet’s Managing Director, John Guscic said: “The acquisition of Zuji represents a unique opportunity to substantially expand Webjet’s marketing footprint particularly in the major future growth markets of Asia and coincides with the opportunity to substantially shape leisure distribution online to coincide with the rapidly changing structural elements of aviation in the APAC region. In addition, Zuji will fast track the development of Webjet’s global hotel contracting and online hotel distribution strategies with substantial synergies available in conjunction with our hotel aggregation model and our Lots of Hotels B2B business in the Middle East.
In conjunction with our recent innovations in distribution technology including mobile devices and the world leading Microsoft Windows 8 platform, we see significant opportunities to deepen our market footprint in an environment where the provisioning of online travel is rapidly transcending traditional desk top access and becoming part of the fundamental traveler’s journey and experience.”
The acquisition will be funded by a placement of approximately 6.9 million new Webjet ordinary shares to raise approximately A$25.0 million of additional capital. The placement is fully underwritten and managed by Credit Suisse (Australia) Limited.
The placement is being offered to institutional and sophisticated investors in certain jurisdictions at a fixed price of A$3.60 per share which represents a 6.0% discount to Webjet’s closing share price on 11 December 2012 of A$3.83 and a 5.8% discount to Webjet’s five day VWAP of A$3.82. New shares issued under the placement will rank equally with existing shares. Further details of the acquisition and placement details are set out in the Investor Presentation pack provided to the ASX today. The pack contains important information relating to foreign selling restrictions with respect to the placement as well as the timetable.
In addition, during January 2013, a non underwritten Share Purchase Plan will be offered to eligible shareholders who will be invited to subscribe for up to A$15,000 of shares each, subject to a maximum cap on the Shareholder Purchase Plan of A$5.0 million. Full details of the Share Purchase Plan will be available in January 2013.
Webjet’s shares will remain in a trading halt pending completion of the placement.
Travelocity’s Global President, Carl Sparks, said: “The strength of the Zuji brand and business across the APAC region made it an attractive proposition for Webjet and we believe that this is the best option for future success of the Zuji business, its employees and customers and I would like to personally thank everybody on the Zuji team for their lasting contributions to Travelocity Global and wish them future success as part of the rapidly growing and successful Webjet group”.
*30% is estimated full year 2013