Despegar.com, Corp. (NYSE:DESP), (“Despegar”), the leading online travel company in Latin America, today announced that on October 1, 2020 it completed the previously announced acquisition of Best Day Travel Group (“Best Day”), one of the leading travel agencies in Mexico. Best Day is expected to represent a key asset for Despegar, given its strong presence and leading market share in Mexico, particularly in the Hotels, Packages and Other Travel Products segment.
Operating for more than three decades in Mexico, Best Day has built an attractive business, with 95% of its 2019 revenues in the Hotels, Packages and Other Travel Products segment, including a robust B2C offering. Online transactions accounted for about 70% of total sales in 2019. Best Day’s revenues for 2019 were approximately US$140 million.
As disclosed on June 11, 2020 the terms of the transaction were as follows:
- Base consideration of approximately US$56.5 million. The purchase price is subject to adjustments based on net indebtedness and working capital, and is payable 36 months following the closing date. The terms require no cash outlays in respect of the purchase price at transaction closing.
- An additional variable purchase price component, ranging from zero to US$20 million, payable 48 months following the closing date. The variable component will be based on the performance of Despegar’s share price during a six month period prior to the fourth anniversary of the closing date.
“We are very pleased to have completed the acquisition of Best Day at attractive terms while protecting our cash position, particularly given the challenging global travel market conditions we are currently facing due to the COVID-19 pandemic. With Best Day, we will be providing new products and services to our customers, driven by its strong non-air positioning. Furthermore, Best Day will enable Despegar to have an even larger online presence, a key benefit as the LatAm region continues its shift to purchasing its travel needs online, and via our leading App, a trend that we expect will accelerate in the near future,” commented Damian Scokin, Chief Executive Officer of Despegar.
Despegar is the leading online travel company in Latin America. With over two decades of business experience and operating in 20 countries in the region, Despegar accompanies Latin American travelers from the moment they dream of taking a trip until they share their memories of that trip.
Thanks to a strong commitment to technological development and customer service, Despegar offers a customized experience to more than 18 million customers. Despegar’s websites and leading mobile apps offer products from over 270 airlines, more than 512,000 accommodation options, more than 1,190 car rental agencies and approximately 326 destination services suppliers with more than 6,000 activities throughout Latin America.
The Company owns and operates two well-recognized brands, Despegar, its global brand, and Decolar, its Brazilian brand. Despegar is traded on the New York Stock Exchange (NYSE: DESP). For more information, please visit www.despegar.com.
Source: Market Watch