Mumbai, Oct. 18: Online travel company MakeMyTrip is acquiring Naspers-owned ibibo to create one of the leading players in the segment.
Both the groups will combine their businesses under MakeMyTrip, which will bring a bouquet of consumer travel brands, including MakeMyTrip, goibibo, redBus, Ryde and Rightstay - that jointly processed 34.1 million transactions during 2015-16 - under one umbrella.
Naspers and Tencent Holdings are selling ibibo Group to MakeMyTrip in exchange for new shares. Naspers holds 91 per cent in ibibo, while Tencent has 9 per cent.
Upon closing the deal, MakeMyTrip will own 100 per cent in ibibo. Naspers and Tencent will become the single largest shareholder in the Nasdaq-listed MakeMyTrip, owning 40 per cent, and will contribute proportionate working capital.
Before closing the deal, $180-million, five-year convertible notes issued by MakeMyTrip to Ctrip.com International in January 2016 will also be converted into common equity, resulting in Ctrip having about a 10 per cent stake in the combined entity, the company said in a statement.
The transaction is expected to close by the end of December. The deal is expected to unlock value for customers, supply partners and shareholders by combining complementary strengths of each business.
"India is a key market for Naspers and this deal reinforces our commitment to the country. ibibo and MakeMyTrip have built leading companies through their innovative use of technology to create exceptional experiences for people travelling throughout India and beyond," Naspers CEO Bob van Dijk said.
Following the closure of the proposed transaction, MakeMyTrip's founder Deep Kalra will remain the group CEO and executive chairman of the company, while co-founder Rajesh Magow will continue to remain its India CEO.
Ashish Kashyap, founder and CEO of the ibibo Group, will join MakeMyTrip's executive team as a co-founder and president.
"Today's announcement is a significant step towards the rapidly-growing travel industry. We expect this to create an even more scalable business with an expertise to transform the booking experience for travellers. I am delighted to lead such a strong team,'' Kalra said.
