Travel Agents

Helloworld growth with co-investment and stake in MTA

Kate Webster

Helloworld Limited announced today it will acquire a 50 percent stake in Mobile Travel Holdings (MTA) for $14 million, with an option to acquire the remaining 50% in five years’ time.

The company will fund the acquisition via a capital raising, seeking to raise $30 million at a bookbuild floor price of $4.25 per share.

Helloworld will have an option to acquire the remaining 50 percent of the business in 5 years’ time at a multiple of 7 times historical earnings.

MTA co-managing directors, Karen and Roy Merricks said they had thought about this for a long time and while it was not an easy decision to make, they believe that it was certainly the right one.

“We know it is important to stay competitive and by aligning ourselves with a company with a similar vision and we know the best thing to do for everyone at MTA is to bring ourselves into line with a group which will continue to grow MTA to its fullest potential,” Merricks added.

“We feel this is a very positive thing for everyone in the company, both our Members and staff and with this partnership, we have the opportunity to grow MTA in a very positive way.”

“We’ve watched as Andrew Burnes has made many positive changes since becoming CEO of Helloworld, Andrew genuinely believes in supporting the future of travel agents and has made changes within Helloworld to combat the issue of competition with our online competitors.”

“He strongly believes in the future of our model – the mobile travel agent. He knows and has witnessed our strong and much loved support team!  Also that MTA has a nurturing environment which you can count on every day creating trusting and long lasting relationships,” Merricks concluded.

Helloworld Limited, who posted a net profit of $1.7 million at 30 June 2016, also announced plans for a “co-investment” strategy of its franchise network in Australia and New Zealand.

CEO Andrew Burnes said the move was “an important step in the ongoing evolution of Helloworld and is part of Helloworld’s strategy to align the interests of Helloworld Limited and our retail agency network.”

Over the coming two years, starting from January 2017, Helloworld will offer to purchase between 20% and 25% of certain qualifying franchisees’ businesses, with each investment considered on a case-by-case basis.

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