‘Why I’ve spent £50m to take my company global’
The chief executive of a travel company has revealed why he has decided to spend £50m on acquiring a Canadian counterpart.
Steve Byrne, who leads Manchester-based Travel Counsellors, told Morning Wire how his firm’s first international deal to buy The Travel Agent Next Door (TTAND) will help boost its growth on top of its planned organic strategy in the years to come.
Backed by a private equity firm, the boss added that an initial public offering is not on the cards in the near future while its current ownership is in place.
The CEO added that he had “no doubt” that the uncertainty around last week’s Budget” will have “led to a softness in consumer demand” across a lot of sectors, including travel.
However, he added that he doesn’t expect that to be “permanent of long lasting”.
Reasons behind the deal
Asked why Travel Counsellors has made this deal, Byrne said: “It’s part of our growth strategy. Canada’s the seventh-largest outbound travel market in the world.
“The business that we’re buying is a market leader. It’s doubled in size in about five years.
“It’s got shared values with Travel Counsellors in terms of how it looks after its agents and its customers, and it will help us accelerate our growth strategy globally to the benefit of. everyone.
“It’s part of a desire to increase the international footprint of the business.
“Our non-UK sales are about 13 to 15 per cent of what we do at the moment and this will take that mix up to about 30 per cent.
“That greater balance in the business I think is sensible.”
On whether this might be the first of any international deals, the chief executive added: “We are open to it. We still want to grow but mainly through organic growth as we have done historically for a long time.
“But we are interested in M&A where that can accelerate our growth either within an existing country or as an entry strategy.”
IPO a no-go for Travel Counsellors
Speaking on the same day shares in rival On The Beach surged thanks to rising sales, the boss of Travel Counsellors ruled out the possibility of his company joining it on the London Stock Exchange anytime soon.
The CEO, whose business is backed by private equity firm Vitruvian Partners, said: “We still think there’s loads of growth to go at..
“At some point Vitruvian will want to realise their investment but we’re not planning for that under any scenario at the moment, including IPO.
“The focus is to see how we can grow, grow sustainably for the betterment of everyone in the business for the longer term.”
Founder reveals why he’s sold up
Flemming Friisdahl, CEO of The Travel Agent Next Door, said: “I have always looked at Travel Counsellors as a leader when it comes to travel professionals that work remotely and flexibly, and I am very excited to be partnering with them for two very important reasons.
“Number one is the culture, it aligns very much with the TTAND culture, given it is all about our support team and our agent partners.
“The second reason is their commitment to being innovative and bringing the most effective technology tools to their community of travel experts.
“We cannot wait to bring some of the benefits of Travel Counsellors’ sector-leading technology and product to support our team in Canada.”
Friisdahl and the TTAND management team are staying on at the company after the deal completes.