CNG floatation hopes to raise €65m
CNG Travel Group, whose room reservation software is already in use by four of the top five corporate travel agents in America, will be valued at up to $250m when it lists on the Alternative Investment Market (AIM) for developing companies.
Chief executive Finbarr Power said CNG would seek a full listing in London or on an American exchange such as the Nasdaq in due course. Mr Power holds a 20% stake in the company, which he helped set up in 1999. Other shareholders include the Mennolly Homes group, which owns 20%, and company management, who have approximately 10% of the group, with the balance held by private investors.
CNG's software sells hotel rooms in 133 countries and a total of 3,300 cities. The company processed sales worth over $550m last year and expects this to grow to up to $700m in the current year. Its main focus is on the American market, where Mr Power estimated the internet sales market was worth up to $8bn. He described the potential for growing the business as "absolutely enormous" and hoped to grow CNG into a billion-dollar business within 18 months. Four-fifths of hotel rooms in the US are booked by the corporate market, where CNG is strongest.
The company employs 55 people in Kenmare but Mr Power said this would grow to 75. Approximately half of these are responsible for developing online reservation software in-house. A further 60 people work for CNG in New York. Mr Power said the group's profitability was far higher than other businesses with this level of employees.
CNG also plans to enhance its presence in the fast-growing Asian market and signed a major contract with one of the top five travel agents in Japan yesterday. Mr Power is currently in negotiations with a number of Asian travel companies and plans to add a substantial number of hotels in China to his list before the summer.
Mr Power said the company was unique in the Irish business environment and was already a competitor on the global stage. CNG had built itself up very quietly by agreeing deals with major industry players without excessive fanfare. Mr Power said the stock market listing would provide CNG with fresh capital and a higher profile. The listing will be handled by London broker Evolution Beeson Gregory. CNG will be the second-largest Irish flotation this year, after Eircom.
The listing follows a well-worn path beaten by Irish companies in recent years. Other companies with Irish links on the AIM include Alltracel Pharmaceuticals, Mean Fiddler and Cork-based EiRx Therapeutics.
