With the announcement of its quarterly results, MakeMyTrip also announced the acquisition of companies in the ‘Hotel Travel Group’ (HT Group), which has been operating the website www.hoteltravel.com for more than ten years and has presence in Thailand, Singapore and Malaysia. The acquisition is in line with MakeMyTrip’s strategy of strengthening its presence in hotel and holidays segment in India and South East Asia, as the group has tie ups with approximately 80,000 hotels across the world. So MakeMyTrip will be able to increase its hotel inventory specifically in the regions, which are popular among Indian travellers.
According to MakeMyTrip, the total consideration payable to the Promoters of the HT Group by MakeMyTrip for acquiring the HT Group is $25 million, out of which $15 million was paid partly in cash and partly in the form of MakeMyTrip shares in the first closing that occurred on November 6, 2012. The balance amount of $10 million is agreed to be paid in the form of MakeMyTrip shares, in 3 annual tranches through March 2016.
Following the acquisition, two of the Promoters of the HotelTravel Group will continue in employment with the group in key capacities, and will be eligible for additional earn outs and incentives for the next 3 — 4 years based on HT Group meeting certain revenue and EBIDTA targets, according to MakeMyTrip. The additional earn outs can range from NIL to $35 million and will be payable partly in cash and partly in the form of MakeMyTrip shares, it added.
MakeMyTrip’s Previous Acquisitions
MakeMyTrip’s other acquisitions include Singapore based Luxury Tours & Travel Pte Limited (LTT), which it had acquired for more than $3 million in February 2011. It had also acquired a 19.9% stake in Le Travenues Technology Private Limited, which owns and operates www.ixigo.com, an online travel meta search engine for cash consideration of $4.8 million for the purchase of new and existing shares, in August 2011. In November 2011, MakeMyTrip had acquired My Guest House Accommodations Private Limited (MGH), a company that used to aggregate, sell and distribute hotel room inventory focused on budget lodging accommodations and serviced apartments, with an aim to improve efficiency in the distribution of hotel room inventories.