Ebookers buys high street rival

Online travel agent ebookers today unveiled a deal to buy high street rival Travelbag for £55m (€83m) as it announced the departure of managing director Dr Sanjiv Talwar.

Travelbag has annual sales of £200m (€301.6m) through its three non-package brands – Travelbag, Bridge the World and Travelbag Adventures – and predominantly sells trips to Australia and New Zealand.

The agreement is set to give the combined group gross sales of around £500m (€754m) a year as ebookers aims to hit annual sales of £1bn (€1.5bn) through acquisitions and organic growth.

In a statement to the London Stock Exchange, the company said Dr Talwar had decided to take a break “for health reasons”.

His responsibilities will initially be assumed by the company’s chief executive Dinesh Dhamija and other members of its management team but the post could be filled from the influx of Travelbag managers.

The merger is also expected to see 20-year-old Travelbag’s products increasingly sold on the internet.

Ebookers has previously acquired 10 “bricks and mortar” travel agencies and moved them to internet operations using its technology and marketing techniques.

Mr Dhamija said: “Travelbag, Bridge the World and Travelbag Adventures are successful, profitable travel businesses, whose management I have always viewed with respect over the years.

“By combining our organisations, we expect to increase buying power and broaden our product offering, accelerating ebookers towards our target of £1bn (€1.5bn) sales within two years.

“By using our expertise to grow online sales in the Travelbag brands, and to reduce costs through integration and the transfer of functions to India, we expect to create significant value for shareholders.”

Following completion of the merger, the head offices and back office functions of the two operations will be combined while their brands will retain separate sales and marketing.

Listed on the London Stock Exchange and Nasdaq, ebookers offers customers online shopping for travel-related products and services including discount airfares and hotels to 11 European countries.

The company has hired several new executives during the past 12 months including Nigel Addison Smith as chief financial officer, Philip Dale as chief information officer, and Thomas Meyjes as a regional director.