CNG pays $12.5m for Places ToStay
Online travel and technology business CNG Travel Group has completed the acquisition of the business and assets of PlacesToStay (PTS), the PlacesToStay brand and more than 140 Uniform Resource Locators (URLs), for $12.5m (€10.1m).
The acquisition was funded through an upfront payment of $12m (€9.7m), with a further deferred component of $500,000 (€404,000) to be paid following a transitional period of three months. The effective date of the acquisition is August 1, 2004.
PTS is a consumer-facing hotel distribution business (4th largest hotel directory in the US per “Neilsen//NetRatings” report of February 2004) that will increase CNG’s leisure footprint, providing a strong platform on which to distribute CNG’s merchant inventory to that leisure segment, CNG said in a statement.
PTS has eight primary consumer websites, is available in seven different languages and has access to over 5,000 destinations in 140 countries worldwide.
In the financial year 2003, PTS generated 243,000 reservations which had total travel value of $49.7m 9€40.2m) and yielded a gross margin of $4.9m (€4m) before costs in the financial year.
"CNG intends to generate shareholder value from the Acquisition through improving CNG’s mix of business from a predominantly corporate travel business to having more exposure to the higher margin leisure sector and distributing CNG’s existing merchant inventory to the leisure market," CNG said in a staement.
