SYDNEY, AUSTRALIA: Helloworld Travel Limited (ASX: HLO) has agreed to acquire 100% of Express Travel Group (ETG) in Australia and New Zealand from current owners Tom Manwaring and Sintack Pty Ltd for $70 million.
Founded as Orient Express Travel Group in 1983, Tom Manwaring joined in 2000 after 29 years with Cathay Pacific and took full ownership of the business in 2003. In 2014 the word “Orient” was dropped from the name.
Today Express Travel Group operates an air ticket consolidation business, retail travel networks and cruise and package wholesaling in Australia and New Zealand with a national support network and offices in Melbourne, Sydney and Auckland.
The company employs over 100 personnel and encompasses a suite of brands, including Express Tickets, Independent Travel Group, Select Travel Group, Alatus, italk travel & cruise, Creative Cruising AU/NZ, and First Travel Group, YOU Travel, and Lifestyle Holidays in New Zealand.
Consideration for the acquisition will be a mixture of shares and cash with the cash component to be fully funded from HLO’s existing cash reserves.
Given the related party nature of the transaction (Sintack Pty Ltd, which owns 50% of ETG and has a 13.31% shareholding in HLO) the acquisition will require shareholder approval and notice of an Extraordinary General Meeting, to be held on Friday July 21 July, will be sent to HLO shareholders.
Helloworld Travel will be acquiring 100% of the business from the vendors and Tom Manwaring will remain as CEO and a Director of ETG.
The acquisition will be earnings accretive in FY24 and beyond. The consideration represents an FY23 EBITDA multiple of approximately seven times forecast normalised earnings for ETG in FY23 of $10.0m – $11.0m.
Andrew Burnes AO, CEO and Managing Director of Helloworld Travel Limited said “We are delighted to announce our forthcoming acquisition of ETG.
They have been one of the most successful travel operations in Australia and New Zealand in the ticketing, retail network and distribution sectors and we look forward to the continued growth of the business under Tom’s leadership and vision.”