Cox & Kings Transfers Stake in Two Arms to Malvern
Mumbai: Travel firm Cox & Kings has transferred its stake in two subsidiaries, hotel booking website LateRooms UK and short-break specialist Superbreak, to Malvern Enterprises UK, a special purpose vehicle it formed with a Europebased private equity investor. The company said it sold 100% in LateRooms – which it acquired in October last year - to Malvern Enterprises for £20 million (Rs 189.02 crore). Cox and Kings’ 65.58%-owned subsidiary, Holidaybreak, sold 100% of its Superbreak business to Malvern in a transaction whereby Holidaybreak received a net cash consideration of £9.25 million. Cox & Kings owns 49% of Malvern Enterprises, with the PE firm holding the rest.
Chief Financial Officer Anil Khandelwal said the SPV was setup recently when the transaction was conceptualised. Post the deal, Cox & Kings effectively holds 49% in both LateRooms and Superbreak. “We acquired LateRooms last year and the primary objective was that it gave a substantial leverage to convert the Superbreak business into a B2C business over time. From our perspective, the synergies of Superbreak and LateRooms are immense but the synergy will take time. Meanwhile, we got this opportunity where a private equity investor was willing to invest in these two companies along with us and that’s why we seized the opportunity,” said Khandelwal. Through the transaction Cox & Kings received £22.88 million cash, which has been used to reduce debt.
The transaction is effective March 31. Cox & Kings’ 49% equity stake in Malvern will be accounted as an investment in an associate company and the proportionate share of earning will be reflected in the travel firms’ accounts from fiscal year 2017. While Cox & Kings had acquired 100% stake in LateRooms for £14 million.