Hotelbeds Group is selling its destination management division – including the Destination Services, Intercruises Shoreside & Port Services and Pacific World brands – to TUI for 110 million euros (US$136 million).
TUI had earlier sold Hotelbeds for 1.2 billion euros in 2016 to private equity group Cinven and Canada Pension Plan Investment Board.
The deal will allow TUI to expand the destination services market, which is estimated at around 140 billion euros and currently growing at around seven per cent year on year, the company said in a press release.
Fritz Joussen, TUI group CEO, commented: “The global market for these services is growing and offers considerable potential for TUI.”
TUI also sees “interesting” potential as the handling agent for cruise companies in port, enabling it to become a supplier rather than a customer. “The acquisition will thus bring commercial synergies to the group’s cruise line business”, said Joussen.
For Hotelbeds Group, which doubled the size of its business through the acquisitions of Tourico Holidays and GTA last year, the latest deal will result in a “simplified structure” that will enable it to “focus fully on (its) bedbank core”, said executive chairman, Joan Vilà.
And while Vilà said the Destination Management division has been “highly successful over the last 18 months”, the company came to the decision that selling to TUI – which initiated the deal – would be in the best interest of all stakeholders including employees and business partners.
“TUI is well placed to continue the division’s growth trajectory, given its own core tour operator strategy as well as the longstanding and significant relationship between our two groups, with TUI being an important customer and partner,” he added.