Latin American digital travel agency giant Despegar.com signed a $15 million acquisition deal for the Brazilian travel agency TVLX Viagens e Turismo S.A (Viajanet) as part of its regional consolidation strategy.
Under the terms of the deal, which is subject to regular closing rules and expected to take place in the second quarter of this year, Despegar.com will pay 60% of the purchase price at closing and 20% in 24 months. The remaining 20% balance would be due in 36 months.
“The acquisition of Viajanet, our third in the last two years in Brazil, is another step in our regional consolidation strategy that will enable us to deploy more of Despegar’s higher-margin non-air inventory through a new brand and its customer base while bolstering our team in the country,” Marcelo Grether, chief M&A and new business officer of Despegar, said in a press release on Friday (May 6).
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“We expect to capture other significant synergies by leveraging Despegar’s technology platform to enhance Viajanet’s conversion rates and performance marketing capabilities, among other benefits,” Grether added.
Viajanet posted an estimated $30 million in audited revenues in 2019. Two years later, its online sales comprised about 98% of total sales, with 88% of gross bookings in B2C and the rest in B2B. Further, 98% of gross bookings were in the air vertical of Brazil’s travel market, which will give Despegar cross-selling opportunities for non-air products like accommodations.
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Despegar launched 20 years ago and operates in 20 countries in Latin America and serves over 29 million customers. Despegar is traded on the New York Stock Exchange under the ticker symbol DESP.