COMPANY TAKES OFF WITH KIWI PURCHASES
FLIGHT Centre shares soared to a 17-month high yesterday after revealing plans to buy two New Zealand travel firms for an undisclosed amount.
The Queensland-based travel company’s shares closed up 3.65 per cent at $45.10 after it announced it had agreed to acquire Travel Managers Group and Executive Travel Group, a move that would significantly increase its market share in the country.
TMG has a 22-store franchise chain and is predominantly leisure-focused, while ETG is the country’s largest independent corporate travel management company.
The move is Flight Centre’s second big acquisition announcement in under a month.
In July it revealed it had acquired Olympus Tours, a Mexico-based travel company, and a Thailand-based hotel operator, while in 2016 the company rapidly expanded its European footprint.
Managing director Graham Turner said the New Zealand operations would now be the company’s fifth largest by sales, with the addition of the two companies expected to bring Flight Centre New Zealand close to $NZ1.5 billion ($A1.41 billion) in sales.
“Executive Travel and Travel Managers are profitable businesses, generating earnings before interest, tax, depreciation and amortisation in excess of $NZ3 million annually, with solid growth trajectories and good track records of success,” Mr Turner said.