The Telegraph
Friday , February 7 , 2014
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Balmer makes buy trip

Viren Sinha in Calcutta on Thursday. A Telegraph picture

Calcutta, Feb. 6: Balmer Lawrie, the city-based diversified PSU, has expanded the scope of its tour operations with the acquisition of Mumbai-based private travel company Vacations Exotica Destinations Pvt Ltd.

In a filing with the Bombay Stock Exchange, the Calcutta-based company said it had taken over “by way of sale/transfer of business undertaking the premier holiday brand Vacation Exotica”.

As part of the transaction, which is estimated at Rs 20 crore, Balmer Lawrie will absorb 110 employees, offices and preferred partners from the travel firm, besides selected liabilities such as money owed by it to various tour operators.

Vacation Exotica began operations in 2007 and has a customer base of 40,000 travellers. It conducts tours in the US, South America, Canada, Europe, Australia, South Africa and the Far East. The company is yet to break even.

Balmer Lawrie, on the other hand, sells about half a million tickets annually to mostly PSU officials and bureaucrats.

“There is a great deal of synergy of the two businesses and this takeover is an endeavour to strengthen our foothold in the tours domain. It will help us to integrate our travel and tourism business together,” Balmer Lawrie chairman Viren Sinha said.

At present, over 40 per cent of Balmer Lawrie’s turnover come from the travel business. Following the takeover, Sinha expects the company add Rs 150 crore to the turnover.

“The tourism sector is growing, particularly driven by an increase of outbound tourists. We can expect the revenues from the firm to double in 2014-15,” he said. The takeover was funded mostly through internal accruals.