Top MakeMyTrip shareholder to buy global travel search aggregator Skyscanner
Nasdaq-listed Ctrip.com International Ltd, which provides travel services including accommodation reservation, transportation ticketing, packaged tours and corporate travel management, has agreed to acquire global travel search site Skyscanner Holdings Ltd, for nearly £1.4 billion ($1.74 billion) in its bid to grow bookings for hotels, rental cars and flights for travelers.
The purchase consideration consists of mainly cash, the remainder consisting of Ctrip ordinary shares and loan notes, the company said in a statement on Wednesday.
The boards of directors of the Ctrip and Skyscanner have approved the transaction, which is subject to customary closing conditions, and is expected to close by the end of 2016. Edinburgh-headquartered Skyscanner's current management team will continue to manage Skyscanner's operations independently as part of the Ctrip group.
Skyscanner enables users to compare prices from hundreds of travel sites when searching for flights, hotels, and rental cars. It ranks as one of the top online travel brands based on search interest, serving 60 million monthly active users and available in over 30 languages.
"Skyscanner is one of the largest travel search platforms in the world," said James Jianzhang Liang, co-founder and Executive Chairman of Ctrip. "This acquisition will strengthen long-term growth drivers for both companies. Skyscanner will complement our positioning at a global scale, and we will leverage our experience, technology and booking capabilities to help Skyscanner."
"Today's news takes Skyscanner one step closer to our goal of making travel search as simple as possible for travelers around the world. Ctrip and Skyscanner share a common view â€“ that organizing travel has a long way to go to being solved. To do so requires powerful technology and a traveler-first approach," Gareth Williams, co-founder and chief executive officer of Skyscanner said.
Earlier this year, Indian online travel company MakeMyTrip Ltd had entered into an agreement with Ctrip.com, under which the Chinese travel services firm had agreed to invest $180 million (Rs 1,200 crore) through convertible bonds into the online travel agency.
In October, in the biggest consolidation move in the online travel agency (OTA) space in India, NASDAQ-listed MakeMyTrip Ltd agreed to buy ibibo Group, which is co-owned by South African technology group Naspers Ltd and Chinese investment firm Tencent, in a stock deal.
Now the five-year convertible notes that Ctrip holds in MakeMyTrip will also be converted into common equity, resulting in Ctrip having an approximately 10% stake in the combined entity, making it the second largest shareholder.
Other significant shareholders of MakeMyTrip include SAIF Partners, T Rowe Price, Tiger Global and company founder and chief executive Deep Kalra.
Founded in 2003, Skyscanner, on the other hand, has a separate India website.
The country recorded a 145% increase in revenue in 2014-15 compared to a year ago, according to a Hindu Business Line report on May 22, 2015, citing a company official.
In India, Skyscanner allows users to search for airfares from both airlines' websites and online booking platforms such as cleartrip.com, makemytrip.com, yatra.com, goibibo.com and musafir.com, among others.
Skyscanner offers a fare comparison and booking facility from aggregators and fleets as well as vehicle type.
Meanwhile, Yatra Online Inc., the company that runs Yatra.com, one of India's top online travel agencies (OTAs) is set to hit the public market in the US soon.