India's MakeMyTrip to buy Naspers, Tencent-backed ibibo
Indian online travel agent MakeMyTrip has agreed to merge with rival booking portal ibibo Group, which is backed by South African internet conglomerate Naspers Group and China's Tencent Holdings, in an all-stock deal.
MakeMyTrip will issue new shares to Naspers and Tencent's jointly-owned holding company in exchange for 100% of ibibo, according to a release. Closing is expected by the end of December, subject to shareholder and regulatory approval. After that, ibibo Group companies will operate under the MakeMyTrip brand.
The deal will make Naspers and Tencent the largest single shareholder in MakeMyTrip, with a combined stake of 40%; the two will contribute proportionate working capital on close. Currently Naspers owns 91% of ibibo, with Tencent holding the rest. Chinese listed travel services firm Ctrip, which invested $180 million in MakeMyTrip in January, will see its five-year convertible notes converted to common equity, giving it about a 10% stake in the company.
Founded in 2007, ibibo manages a number of popular travel sites in India, including trip aggregator goibibo, and enterprise-focused travel agency platform Travel Boutique Online. It acquired online bus ticketing platform RedBus in 2013 for an undisclosed amount. Tencent also used ibibo to launch its WeChat messaging platform in India.
Following the transaction, ibibo's founder and CEO Ashish Kashyap will join MakeMyTrip's executive team as co-founder and president of the combined company. MakeMyTrip co-founders Deep Kalra and Rajesh Magow will remain in their current positions of group CEO and executive chairman, and India CEO, respectively.
"Today's announcement is a significant step forward for the rapidly growing travel industry in India. We expect this deal to create an even more scalable business with the expertise to transform the booking experience for Indian travelers," said Kalra.
MakeMyTrip has counted several global investment firms among its supporters over the years, including SAIF Partners and Tiger Global Management, who have backed the company since before its US IPO in 2010. According to the company's most recent annual report, SAIF still held a 14% stake as of January 2016. Tiger had fully exited its stake as of February.
For the year ended March 2016, MakeMyTrip reported revenue of $336 million, up from $300 million the year before. Over the same period the company's net loss grew from $18 million to $88 million.
More on South Asia
Latest News
Asian GPs slow implementation of ESG policies - survey
Asia-based private equity firms are assigning more dedicated resources to environment, social, and governance (ESG) programmes, but policy changes have slowed in the past 12 months, in part due to concerns raised internally and by LPs, according to a...
Singapore fintech start-up LXA gets $10m seed round
New Enterprise Associates (NEA) has led a USD 10m seed round for Singapore’s LXA, a financial technology start-up launched by a former Asia senior executive at The Blackstone Group.
India's InCred announces $60m round, claims unicorn status
Indian non-bank lender InCred Financial Services said it has received INR 5bn (USD 60m) at a valuation of at least USD 1bn from unnamed investors including “a global private equity fund.”
Insight leads $50m round for Australia's Roller
Insight Partners has led a USD 50m round for Australia’s Roller, a venue management software provider specializing in family fun parks.